E. J. Brach & Sons, Ecko Products (Glaco Group), Ecko Housewares, and Boyle-Midway. These entities appear to have a great deal of control over their own operations and are engaged in the manufacture of separate commodities, with the possible exception of the two Ecko entities which manufacture related products, namely cooking utensils and kitchenwares. Wyeth deals in drugs, medicines, and chemicals and Brach in candies. Boyle-Midway, in the Sub-No. 146 146 application, apparently produces household cleaning compounds, while previous proceedings, discussed above, indicate its involvement in commodities dealt in by various types of retail and chain stores. Neither Bass' petition for reconsideration nor the accompanying statements by officials of the parent contain anything to cause our disagreement with the review board's conclusion on this issue. These pleadings emphasize the fact that the parent has actually entered the contract with Bass, a factor which, as has been discussed, is not controlling in determining whether a limited number of persons is being served. The statement of the parent's assistant vice president attempts to downplay the divisions' actual existence as entities and stresses that official's general supervision of their transportation policy. It does not, however, claim that routing of the divisions' shipment is done at the top level. In fact, quite the contrary is indicated from the petition itself, which at one point states that it "would be impossible for American at the corporate level to select carriers on a day-to-day basis and to route the traffic." This is precisely in accord with our opinion and that of the review board. Of necessity, American Home Products is too large an organization to be conducting the transportation operations of its divisions. The divisions themselves appear to be the shippers, and a granting of the Sub-No. 146 application would permit Bass to serve an additional three or four persons beyond the two which they are serving under existing American Home Products authority.* DART INDUSTRIES, INC. Bass has no permanent Dart authority. The review board found that the Sub-No. 143 and 147 applications actually proposed service for three persons, Thompson Industries Co., Gering Products, and Thatcher Glass Manufacturing Company. As the board indicated in its report, the traffic managers of these divisions each filed verified statements in which they attested to their responsibility for arranging for their respective companies' motor carrier transportation. This evidence clearly justifies the board's conclusion *Further indication of American Home Products' considerable size and diversity can be found by reference to the appendix to protestant Hennis' verified statement in the Sub-No. 146 proceeding. as to control of the traffic and the number of persons being served. Bass' petition for reconsideration does not cause us to disagree with this conclusion. Its attempts to convince us that Dart controls the traffic do not indicate more than that Dart maintains some guidance of transportation policy. At the same time, the petition emphasizes the impossibility for a corporation the size of Dart to have the traffic movements of each plant handled through corporate headquarters. We find this admission quite in accord with our expectations and further confirmation of our belief that actual routing of shipments must be effected on the division level, thus rendering these three divisions the persons for which service would be provided. The argument is continually made in the petition that ultimately Dart has control over any activities of its divisions, and that certain activities and responsibilities are delegated to the divisions, subject to being rescinded if Dart chooses to do so. Obviously, a parent does have ultimate control over all entities it encompasses since it has ultimate ownership. The point to be recognized, however, is that these divisions have been delegated these responsibilities and that no matter whether Dart has the power to rescind them, Dart has not done so and would not do so for the simple reason that it would be difficult for Dart to run the operations of all of its divisions. The vesting of authority in a division to select carriers and route its own shipments is sufficient evidence that that division is the proper contracting person for purposes of section 203(a)(15). In the pending Sub-No. 161 proceeding, a verified statement in support of the application is filed by the same official as supported the Sub-No. 147 application. In both instances he claims responsibility for Thatcher Glass Manufacturing Company's transportation activities, but in the Sub-No. 161 proceeding he refers to himself as a director of transportation services for Dart Industries, while in the previous application he considered himself Director of Transportation Services for Thatcher. Since his later statement was filed subsequent to service of the review board's report in the Sub-No. 143 and 147 proceedings, it appears that Bass and Dart are attempting now to deemphasize Thatcher's role in the conducting of its own operations. On this record we cannot conclude that the situation has changed during the intervening period with respect to Thatcher's control over its traffic and we view Thatcher as the proper contracting person in this proceeding as well. It is significant in this regard that the application in this proceeding actually seeks authority under contract with Dart Industries, Inc., Thatcher Glass Manufacturing Co., Division. This phrasing intimates that applicant and shipper themselves view the proposed service as being for Thatcher Glass rather than its parent. In the Sub-No. 88 proceeding, Bass wishes to add Dart as a shipper. The verified statement in support, filed by a manager of distribution and transportation of Dart, indicates that service will be provided for facilities operated by Thompson Industries Co., Consolidated Thermo Plastics Co., Rexene Polymers Co., and Colorite Plastics Co. It also claims that Dart normally pays the freight charges, selects the carrier and directs the routing. Considering what we have learned about Dart from the previously discussed evidence, and in particular with respect to Thompson Industries, we cannot conclude that Dart itself actually controls the operations of those divisions that closely. We are told so little about these operations individually that it is hard to draw any definitive. conclusions regarding them, but we certainly should not assume that the proposed service would be service for one person, in view of the manifestations of separate divisional control present in the SubNos.. 143 and 147 proceedings. In sum, Bass' proposals to serve Dart would appear to involve service for an additional six persons. DISCUSSION AND CONCLUSIONS REGARDING BASS Although the overall lack of clarity and specificity in the evidence before us precludes determination of the exact number of persons Bass serves as a contract carrier, that number would appear to be approximately between 15 and 17. The addition of shippers requested to be served in the pending proceedings would raise the number of persons to approximately between 24 and 27. We need not make a precise determination of the actual number involved, since we have considerable discretion in applying the "limited number of persons" test to the facts presented in these proceedings. Even without considering the pending applications, Bass' existing authority cannot be viewed as conforming to the principles of contract carriage. Some of the factors generally considered in determining what constitutes a limited number of persons in a given case are the different types of commodities transported, the number of permits under which the carrier operates, the territory in which the operations are conducted, the similarity in the services provided the contracting shippers, the degree of specialization required by the nature of the businesss of the shippers involved, and the historical manner in which the carrier's business has grown and developed. See Keller, supra, at 49; Cardinale Trucking Corp. Extension Centreville, N.J., 100 M.C.C. 126, 130 (1965); Prang Trucking Co., Inc., Ext.-New Brunswick, N.J., 117 M.C.C. 38, 45 (1972). Consideration of those factors in respect to Bass reveals authority to transport numerous broad commodity lines basically throughout the United States, under almost 40 permits, for shippers which in many cases are not at all related and have specific and distinct transportation needs. On petition, Bass decries the Commission's reliance on such "nonstatutory" factors in deciding contract carrier applications. These factors, however, have the legitimate function of helping to depict the overall operations of a contract carrier, so that determination of the limits of contract carriage will be made on the basis of the scope of the service provided by each carrier rather than on the basis of rigid rules setting the maximum number of persons at a fixed limit. While the principle of restricting operations of the normal contract carrier to service for six or eight persons is only a general standard or guideline, no special circumstances have been described in any of these proceedings which would warrant our viewing Bass' service for approximately 15 persons, representing 15 distinct manufacturing and shipping operations, as being sufficiently limited in scope to constitute legitimate contract carriage. Nor is Bass aided by the so-called "class of shippers" exception. This exception basically allows service for an expanded number of entities in the very limited circumstances where those entities are closely related by some common business practice or characteristic and where the service performed is of a highly specialized and unique nature, acting in some way to unite the shipper entities. The prototype decision in which such a class was found to exist is Armored Motor Service Co., Inc., Conversion Proceeding, 77 M.C.C 433 (1958), in which the respondent carriers transported money, securities, and other valuables for numerous banks, department and chainstores, brokerage offices, theaters, and other businesses. The specialized service, required by all the shippers, involved use of armored cars constructed of bullet-resisting steel plate and bulletproof glass, and manned by crews trained in the use of firearms. The necessity that the service provided be specialized and unique was emphasized further in Armored Carrier Corp. Extension-Vermont, 92 M.C.C. 336 (1963). Other decisions in which a class of shippers has been found are Lane and Kaplan Extension-New Jersey, 78 M.C.C. 547 (1958); Howell Trucking Co., Inc., Extension-Secaucus, 86 M.C.C. 643 (1961); and S. Klein Trucking Corp. Contract Carrier Application, 89 M.C.C. 53 (1962). On the other hand, no such class was found to exist in Crete Car. Corp.-Maremont Contr.-Auto Parts, 117 M.C.C. 634 (1972); Keller, supra; and Continental, supra. This exception is designed to deal with only a few very special situations and does not apply to circumstances such as the present one, in which Bass is serving various conglomerate organizations, in no way related, and each of which itself conducts diverse operations. Finally, we feel obligated to make it clear that Bass' operations would not be deemed legitimate contract carriage even if we were to accept Bass' viewpoint concerning the identities of its shippers. Although Bass would, under this construction, be serving six persons, in accordance with our previous discussion this situation is one in which six persons would not be considered a limited number. A determination of the proper limitations of Bass' contract carrier operations would still involve consideration of the circumstances surrounding those operations, including the size and scope of the entities for which service is performed. In most cases, as we have seen, these entities are very large, of considerably intricate structure, and encompass operations of great diversity. They are far from being six "normal" persons, as would be, for example, six small, undiversified shippers, and consequently, the operations Bass performs for them are far from the operations of the "normal" contract carrier whose applications are subject to close scrutiny under the Umthun standard. Bass insists in its pleadings that upon divestitutre of its Fisher authority it will be serving only five shippers, which has consistently been considered a limited number. We cannot emphasize too strongly that in determining the limits of contract carrier authority importance is placed not on the carrier's adherence to some predetermined, and by itself relatively meaningless, number of persons served, but rather on the conformance of the carrier's operations to the limited character contemplated by section 203(a)(15), and what constitutes a limited number of persons will be decided in that light. DISPOSITION OF APPLICATIONS Because Bass' proposed operations cannot be considered contract carriage, we believe it is appropriate to consider the instant applications under common carrier criteria and to determine in each of them whether a need exists for additional common carrier service. Eddleman Bros. Contract Carrier Application, 98 M.C.C. |