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The league only supported that floor amendment when faced with the fact that the proviso language which had been in H.R. 5401 and which appears in S. 1727 was deleted by the House Interstate and Foreign Commerce Committee. While having earlier supported even stronger language we believe the proviso as it appears in S. 1727 page 7 lines 23 to 25 is the minimum of protection needed. Even more earnestly does the league support the preservation in the Commission of primary jurisdiction in interpreting the primary business test. The league considers the provision absolutely imperative under section 4.

In the event that the committee adopts section 4 of S. 1727, the league would also urge that the word "willfully" should be inserted before the word "operates" on line 18 page 6. The reasons for this suggestion are identical with those set forth in our discussion of section 3 above so we shall not burden this committee by reiterating them.

The Freight Forwarders' Institute has suggested that section 4 of S. 1727 be amended so that the same provisions would apply to part IV of the act as well as part II. Such language is included in H.R. 5401. With the qualification stated hereafter, the principles which the league has expressed with regard to the proposed amendment of part II apply as well to any such proposed amendment to part IV. However, a particular problem would arise in this area, under the so-called primary-business test, in setting lines of demarcation between regulated freight forwarders on one hand, and an unregulated, nonprofit association of shippers engaged in consolidating or distributing freight for their members. The league is genuinely concerned that this section would produce an even larger number of unjustifiable lawsuits aimed at harassing such groups or associations of shippers who consolidate and distribute freight for themselves and for their members. To that extent the extension of section 4 private injunctive suits to part IV of the act, as was done in H.R. 5401, is even more objectionable than under part II of the act. Similarly, the preservation of the Commission's primary jurisdiction is even more imperative, if possible, relative to part IV of the Interstate Commerce Act.

For many years the National Industrial Traffic League, numerous other shipper organizations and governmental agencies-including the Interstate Commerce Commission-have urged the enactment of legislation which would give injured parties substantially the same redress under parts II and IV of the act as is presently available under parts I and III. This is the precise approach followed by S. 1732, à bill which is endorsed by the Interstate Commerce Commission, and is strongly supported by the National Industrial Traffic League.

We must bear in mind that this is 1965 and the motor carrier industry is one of the most powerful in the Nation. The arguments raised in 1935 when the Motor Carrier Act was enacted and the industry was in an embryonic stage of development, simply have no application today. The league does not understand why the motor carrier industry wishes to bypass the Interstate Commerce Commission as the appropriate and logical forum to adjudicate reparation matters on a uniform basis for all the modes of transportation subject to their jurisdiction.

The importance of this matter to shippers in this country is illustrated by a recent case decided by the Interstate Commerce Commission. This case was I. & S. Docket No. M-17450, LTL Class Rates and Minimum Charges Between Midwest and Central Territories, reported at 325 I.C.C. 106. In that case, increases in minimum charges and in less-than-truckload and any quantity rates had been published by Middlewest Motor Freight Bureau. These rates had been in effect since September 7, 1963, and applied within Middlewest territory, and between Midwest and Illinois territories. Almost a year and a half later, on February 24, 1965, the Interstate Commerce Commission found the rates and charges to be unlawful. Although shippers in the interim period had been paying these higher rates and charges to the extent in excess of $35 million, they are presently left without remedy for these overcharges against the offending carriers.

This is but one example, intended to show how serious a matter this is to the shippers of the country. We respectfully suggest that in curing this evil the committee should enable shippers to pursue their remedy for reparation against motor carriers and freight forwarders before the Interstate Commerce Commission in the same proven manner as is now provided in parts I and II of the Interstate Commerce Act. The league is gratified to know that the Interstate Commerce Commission still supports this principle as encompassed in S. 1732 in its legislative recommendations to this committee.

Sections 5 and 6 of S. 1727, which are identical to sections 6 and 7 of H.R. 5401, are intended to nullify by legislation the ruling of the Supreme Court in T.I.M.E., Inc. v. United States, 359 U.S. 464 (1959), which held that in postshipment litigation, neither the courts nor the Commission may consider the reasonableness of a motor carrier's charges, when these are applied in accordance with published tariffs. Sections 5 and 6 are intended to permit a court of competent jurisdiction to award reparations to persons injured through violations of the act by motor carriers and freight forwarders subject thereto; and, in accordance with established judicial reference procedures, the Commission would be called on to make an administrative determination in aid of the court. While preferring the provisions of S. 1732, the league supports the provisions of sections 5 and 6 of S. 1727 if they truly provide for a cause of action cognizable in an action at law. We are concerned, however, that sections 5 and 6 do not clearly establish the cause of action needed.

In view of the Supreme Court decision in T.I.M.E., Inc. v. United States, 359 U.S. 464, 3 L. Ed. 2d 952 (1959) we believe the corrective legislation should clearly establish the cause of action by unequivocally stating that carriers subject to parts II and IV of the act shall be liable in damages to the persons injured for any violation of the act. Such language is in part I in section 8. The absence of a similar provision in part II led the Supreme Court to conclude there was no cause of action for reparations under part II. Cf. 359 U.S. at 370. We urge, therefore, that language similar to section 8 of part I, 49 U.S.C.A. section 8, establishing liability in damages for violations of the act, be included in any amendment to part II or IV. Such language is included in the first amending paragraph of S. 1732, page 1, lines 6-8 and page 2, lines 1–7.

With the reservation that language establishing carrier liability in damages be inserted, or at a minimum it be developed in the legislative history in the committee's report, the league supports the passage of sections 5 and 6 of S. 1727 although preferring the greater protection afforded by S. 1732.

S. 1143 is a bill to amend part III of the Interstate Commerce Act to authorize the Interstate Commerce Commission to revoke, amend, or suspend water carrier certificates or permits under certain conditions.

The league's policy on this subject reads as follows:

The Interstate Commerce Commission should be given authority to revoke certificates, permits, and licenses previously issued to a carrier by water, for willful failure to comply with any provision of the act or with any lawful order, rule, or regulation of the Commission promulgated thereunder, or with any term, condition, or limitation of such certificate, permit, or license, or for willful failure to engage in or to continue to engage in the operation authorized by such certificate, permit or license.

Under the above policy, the league supports S. 1143.

S. 1728 is a bill to amend section 222(b) of the Interstate Commerce Act with respect to the service of process in enforcement proceedings, and for other purposes.

This bill is similar to section 4 of H.R. 5401 and, without repetition. the league's comments with respect to section 4 will apply equally to this bill.

S. 1732 is a bill to amend section 204 (a) of the Interstate Commerce Act in order to provide civil liability for violation of such act by common carriers by motor vehicle and freight forwarders. This bill relates to the recovery of reparations under parts II and IV of the Interstate Commerce Act.

This bill would implement the Interstate Commerce Commission's legislative recommendation on reparations. It would permit any person injured through violations of the Interstate Commerce Act by motor carriers and freight forwarders either to file a complaint with the Commission or to bring suit in the appropriate district court of the United States. The Commission or the court would be authorized to award reparations in such instances. The league supports the comments of the Interstate Commerce Commission on this bill that "the approach embodied in S. 1732 is consistent with legislation now applicable to railroads and water carriers, and therefore, would insure equality of treatment among carriers, and additional shipper protection."

For the reasons outlined in our discussion of sections 6 and 7 of H.R. 5401, the league prefers enactment of S. 1732.

S. 1733 is a bill to make the civil forfeiture provisions of section 222 (h) of the Interstate Commerce Act applicable to unlawful operations and safety violations by motor carriers and for other purposes.

To the extent S. 1733 embodies language similar to that in section 3 of S. 1727 the league reiterates the principles it has stated above on the latter section.

With respect to particular bills I have not mentioned orally or in the written statement, the league has no policy which they wish to present with respect to those particular bills.

This concludes my presentation on those parts of S. 1727 and related bills on which the league wishes to comment. On behalf of the league, I wish to thank the members of this committee for the opportunity to be heard on this subject, and urge a favorable consideration of the views expressed herein.

Senator LAUSCHE. I haven't read your paper. What is the membership comprised of? What type of economic interest in general?

Mr. DONELAN. Primarily shippers, large and small and intermediate. Shippers associations, boards of trade, chambers of commerce and the like.

By way of indicating what we are not, there are no for-hire carriers of any type of any organization of carriers in the National Industrial Traffic League. It is a shipper organization.

Senator LAUSCHE. Thank you.

Any questions?

Mr. SENDER. One question. If two shippers are side by side and are competing, and one shipper goes out and hires an illegal carrier to lower his transportation costs, what can or should the other competing shipper do?

Mr. DONELAN. I think he should first make representations to the competing shipper to develop the facts and the hypothesis that this is, in fact, illegal, to be sure that the competing shipper is conscious of illegality. If, notwithstanding, that shipper persists, he has the right, which I understand is frequently exercised, to go to the ICC Bureau of Inquiry and Compliance and make representations, and I think the traditional approach of the ICC Bureau of Compliance, so far as I have been able to observe, would be to handle the matter first informally with the individual involved, and if there is termination that probably would be an end to the matter. If there was continuation and flagrant, willful disregard, the ICC Bureau of Compliance would take the steps appropriate to them.

Mr. SENDER. Is it not correct that the shipper could obtain immediate relief assuming this bill were enacted by going to court and suing the competing shipper?

Mr. DONELAN. As a matter of theory, taking cases which are in the "black" as distinct from the "gray" and "white," yes.

Senator LAUSCHE. All right, thank you very much for your help. Mr. Joseph Keller, attorney, appearing for Private Carrier Conference, American Trucking Association.

Mr. KELLER. Yes, Mr. Chairman. Our witness will be Mr. William Fayle.

STATEMENT OF WILLIAM L. FAYLE, FIRST VICE PRESIDENT, PRIVATE CARRIER CONFERENCE, INC., AND DIRECTOR OF TRANSPORTATION, BURLINGTON INDUSTRIES, INC., ACCOMPANIED BY JOSEPH KELLER, ATTORNEY, KELLER & HECKMAN

Mr. FAYLE, My name is William L. Fayle. I am director of transportation for Burlington Industries, Inc., with offices on Beaumont Avenue, Burlington, N.C. I appear here today on behalf of_the Private Carrier Conference of American Trucking Association, Inc., as its first vice president.

The Private Carrier Conference, Inc., is a completely autonomous national organization of shippers who operate motor vehicles in interstate commerce incident to, within the scope, and in furtherance of nontransportation primary businesses.

The more than 4,000 members of the Private Carrier Conference range from manufacturing companies which operate hundreds of large motor vehicles to the small businessman who utilizes trucks in local operations.

Organized and existing as a nonprofit corporation under the laws of the State of Delaware, the conference is affiliated with American Trucking Associations, Inc., and maintains offices at 1616 P Street NW., Washington, D.C.

The essential function of the Private Carrier Conference as a trade association is to preserve and maintain the right of shippers to choose on a free and unrestricted basis private carriage as a means of meeting their transportation requirements.

At the outset, we must state that the Private Carrier Conference has been in the forefront in dealing with every effort to eliminate illegal for-hire carriage in the United States.

The Private Carrier Conference has issued, on its own initiative, a pamphlet entitled "Keep It Legal," copies of which will now be distributed to members of the committee. This pamphlet has been widely distributed free of charge to more than 60,000 shippers and private carriers all over the United States.

We would be honored if the chairman would instruct that a copy of "Keep It Legal" be inserted in the printed record of this hearing. Senator LAUSCHE. It is not too long. It will be so ordered. (The above-mentioned pamphlet appears in the appendix.) Mr. FAYLE. The sole purpose of my testimony today on behalf of the Private Carrier Conference is to give the views of the conference on proposed section 4(b) (2). As a preface to my remarks I would like to point out with respect to this proposed section that the Private Carrier Conference endorses the section as it is and notes that the American Trucking Associations has also endorsed this section as proposed.

Senator LAUSCHE. To make the record fully understandable to the layman, what does section 4 (b) (2) deal with?

Mr. FAYLE. The right to sue, an injunctive relief section of the bill. Senator LAUSCHE. That is, the right of an injured person to sue and obtain injunctive relief against the wrong that he claims has been committed.

Mr. FAYLE. Yes, sir.

Senator LAUSCHE. Do you support that?

Mr. FAYLE. Yes, sir.

Senator LAUSCHE. Proceed.

Mr. FAYLE. In this regard, the conference has been advised that the parenthetical clause beginning on line 15 and ending on line 18 of page 6 of the bill was inadvertently included. The conference takes the firm position that the phrase "not including a motor carrier holding a certificate, permit, or grant of temporary authority issued by the Commission under the provisions of section 206, 207, 208, 209 or 210 (a)" should be stricken."

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