This is an appeal under 28 U.S.C. §§ 47a, 345, 28 U.S.C.A. §§ 47a, 345, from a judgment by which the District Court for New Jersey, three judges sitting, set aside an order of the Interstate Commerce Commission, Hoboken Mfrs.' R. Co. v. United States, D.C., 47 F.Supp. 779.
The question is whether appellee, a terminal switching rail carrier, is entitled to an increase in the divisions which it now receives out of joint class and commodity freight rates maintained by it and numerous trunk line carriers, appellants here, on traffic interchanged by appellee at Hoboken, New Jersey, with Seatrain Lines, Inc., a common carrier by water. The answer depends upon whether the Commission is required to treat as part of appellee's costs of performing its carrier service as prescribed by the joint rates, allowances paid by appellee for services performed by Seatrain in effecting the interchange. The Commission's order dismissed a complaint by which appellee sought to have the Commission prescribe for it increased divisions, Hoboken Mfrs.' R. Co. v. Akron, C. & Y. Ry. Co., 234 I.C.C. 114. The order, reviewable by the District Court, is reviewable by this court on appeal. Alton R. Co. v. United States, 287 U.S. 229, 237 240, 53 S.Ct. 124, 127, 128, 77 L.Ed. 275; Baltimore & O.R. Co. v. United States, 298 U.S. 349, 358, 56 S.Ct. 797, 803, 80 L.Ed. 1209; Rochester Tel. Corp. v. United States, 307 U.S. 125, 142, 59 S.Ct. 754, 763, 83 L.Ed. 1147.
Appellee, Hoboken Manufacturers' Railroad Company, operates a terminal switching line extending along the waterfront of Hoboken, New Jersey, for a distance of 1.632 miles. It connects with the Erie Railroad and over it with other trunk lines reaching New York Harbor. Numerous piers on New York Harbor are served by Hoboken, at which the vessels of various steamship lines regularly dock, including those of Seatrain.
Seatrain is a common carrier by water, subject to the Commission's jurisdiction under § 1(1)(a) of the Interstate Commerce Act, 49 U.S.C. § 1(1), (a), 49 U.S.C.A. § 1(1)(a), by reason of its control of Hoboken. Investigation of Seatrain Lines, Inc., 195 I.C.C. 215; Id., 206 I.C.C. 328. Since 1932 it has operated vessels in which it transports freight in loaded railroad cars between Hoboken, New Jersey, Havana, Cuba, and Belle Chasse, Louisiana, a point on the Mississippi River near New Orleans. The loaded cars which it transports are placed upon standard guage railroad tracks located upon four decks of the Seatrain vessels. In loading the vessel, each car is switched onto a track located on a cradle placed alongside the ressel. An overhead crane lifts the cradle containing the car, swings it over the vessel and lowers it through a hatch to the appropriate deck where the car is moved onto one of the railroad tracks on the deck.
In unloading the procedure is reversed. Each car is moved from the deck track onto the cradle. The cradle containing the car is then lifted by the crane and placed on the dock alongside the vessel where the car is switched by Hoboken over its own tracks to a connecting trunk line over which it proceeds to its rail destination. By this operation the expense is avoided of loading and unloading freight into and from the cars at shipside, ordinarily incident to exchange of traffic between rail and water carriers.
In 1932 Seatrain secured control of Hoboken by the acquisition of all of its shares of capital stock except the qualifying shares of five directors, and the two corporations were brought under the management of common officers. In 1936 Hoboken filed a complaint with the Interstate Commerce Commission under §§ 1(4) and 15(6) alleging that the divisions it was receiving out of joint class and commodity rates maintained by it and the trunk lines, appellants here, on carload rail traffic interchanged with Seatrain were too low, and asking an increase. It also sought adjustment of all divisions with respect to such traffic moving under rates prescribed by the Commission subsequent to the date of filing the complaint.