Interstate Commerce Commission v. Illinois Central Railroad

Background

A railroad company used rules to decide which coal mines received daily rail cars when cars were scarce. Several coal companies and the federal rail regulator argued those rules gave unfair preferences by not counting company-owned fuel cars, private cars, and foreign railroad cars. The regulator ordered the railroad to count those cars for two years. The railroad sued and a federal court blocked the regulator’s order only as to company-owned fuel cars; the regulator appealed.

Reasoning

The central question was whether the federal rail regulator had authority to require that a railroad count its own fuel cars when deciding how to distribute scarce coal cars. The Court explained that rail cars and the railroad’s equipment are tools of interstate commerce and thus fall within the regulator’s power to prevent unfair preferences and discrimination. The Court rejected the railroad’s argument that coal moved in its fuel cars was outside commerce. Because the order dealt with preventing preferences in distribution and fit within the regulator’s delegated authority, the lower court should not have blocked enforcement as to company fuel cars.

Real world impact

The ruling lets the regulator require railroads to count company-owned fuel cars when fixing each mine’s share of cars during shortages, changing daily allotments for coal mines and railroad operations. The Court reversed the injunction and sent the case back for further action consistent with its opinion. The Court did not reopen the lower court’s rulings about private or foreign railway cars because those issues were not before it on appeal.

Dissents or concurrances

One Justice (Brewer) dissented from the decision.