City of Chicago v. United States

Background

Two railroad companies filed notices to stop certain interstate passenger trains — one set between Chicago and Evansville, the other between New Orleans and Cincinnati. The Interstate Commerce Commission opened reviews and then entered orders terminating those investigations after finding continued operation was not required and would unduly burden interstate commerce. Cities, state regulatory agencies, and other interested parties sued to challenge the Commission’s decisions. A federal district court held that the Commission’s orders ending investigations were not reviewable as “orders.”

Reasoning

The Court addressed whether an agency’s decision to terminate an investigation is something a federal court can review. The Justices explained that while the Commission has discretion to decide whether to start an investigation (and that choice is not reviewable), once it does investigate it must make a written report and decide the merits. A decision to end an investigation disposes of the merits just like an order requiring action. The Court rejected the distinction between “negative” and “affirmative” orders and said the technical form of the agency action does not determine reviewability. It therefore reversed the lower court’s ruling.

Real world impact

As a result, cities, state agencies, and other challengers can ask federal courts to review Commission decisions that end investigations into proposed train service cuts. This adds judicial oversight to the Commission’s merit decisions, though the initial decision whether to investigate remains discretionary and not immediately reviewable. The ruling may lead to more legal challenges over proposed discontinuances and closer court review of agency findings.