delivered the opinion of the Court.
This appeal involves the legality, under the Elkins Act, of appellants’ activities and course of conduct with respect to the new Food Terminal at Kansas City, Kansas. That city and Kansas City, Missouri, are both part
On December 29, 1939, at the request of the Interstate Commerce Commission, the Government filed a bill to enjoin the Union Pacific, the City Of Kansas City, Kansas, certain of their officers and agents, and thirty-three produce dealers, from violating the Interstate Commerce Act, 49 U. S. C. § 1
et seq.,
and the Elkins Act, 49 U. S. C. §§ 41-45, which prohibit rebates, concessions and discriminations in respect to the transportation of property by railroad
Appellants DeOreo and Fean, before 1937, had promoted various metropolitan terminals with wholesale produce market and rail facilities. In December, 1936, they suggested to Union Pacific the feasibility of such a terminal to be served by its line at Grea/ter Kansas City, and a plan was soon formulated for the construction of facilities on the Public Levee, property of Kansas City,' Kansas; Union Pacific’s aim was to increase its traffic and revenues from perishable food products. The plan contemplated that ownership of the terminal be vested in the City, which .would be eligible for a PWA grant from the United States to cover part of the construction costs. A further consideration was that a city-owned market would be tax-free, and thus able to offer dealers the inducement of especially low rentals. Union Pacific presented engineering and cost estimates to officials of the City of Kansas City, Kansas, who became interested in the project and determined that plans should go forward. Thereafter, Union Pacific and the City participated jointly in the promotion and financing of the terminal; and the court below found after a careful review of the evidence that Union Pacific took “a leading and dominant part.” Union Pacific suggested the plan that financing be accomplished by a PWA grant and by revenue bonds of the City, secured only by revenue from the terminal and other levee property. Union Pacific suggested that the City make DeOreo and Fean exclusive leasing agents of the terminal for a period of ten years; when this contract was disapproved by PWA officials, the two promoters were persuaded to consent to its cancellation, and Union Pacific later caused sub
Union Pacific also caused its officers, employees and agents, and those of its subsidiary, the Kansas City Industrial Land Company, and its affiliate, the Pacific Fruit Express Company, to render various services related to the promotional, leasing and financing activities; it advanced money for financing preliminary expenses; and together with the City it supervised the actual construction. The terminal as completed consists of railroad facilities, owned by Union Pacific, for which it spent $603,000; and the City’s wholesale produce market, with a cold storage plant, produce dealers’ buildings, a farmers’ market, and some terminal trackage, all constructed with
Active solicitation of the Missouri dealers to move to Kansas began in June, 1937. As early as August, 1937, Union Pacific contemplated the necessity of giving inducements to dealers, either by making direct payments or by buying from them “unwanted properties.” In the summer and fall of that year, DeOreo and Fean induced five of the Missouri dealers to serve on a committee for the promotion of the Kansas terminal, agreeing to pay each of them $5000 “in consideration of the services rendered . . . and the occupancy of the food terminal” as tenant. By August, 1938, Union Pacific’s employees and agents had negotiated with other dealers with respect to cash payments and other, inducements. As opposition developed on the Missouri side, the district court found that the campaign for enlistment of the Missouri dealers became “open and intense.” Union Pacific, however, was anxious to avoid violating the Elkins Act, and sought the advice of its legal department, which rendered an opinion that payments made by the City to dealers would be lawful. With the'assistance of a committee of prominent citizens, the City was persuaded to undertake such payments; in December, 1939, it passed Resolution 11275 authorizing use of the Public Levee Revenue Fund for settlements either with cash or credits, on rental, or both, to cover costs incurred by prospective tenants, “due to rental obligations on present places of. business and costs due to abandonment of equipment and facilities
The City, although now willing to make payments to prospective tenants where necessary, was lacking funds. In arranging for refrigerator service at the market, Union Pacific contracted to buy its entire Kansas City and Omaha ice requirements from the City Ice & Fuel Company. This company leased the market’s cold-storage unit for fifteen years at $37,500 per year; Union Pacific now urged the company to pay the City $80,000 as advance rent.- The City Ice & Fuel Company did this and also, at Union Pacific’s and the City’s suggestion, deposited $25,000 with a bank as collateral for proposed unsecured and inadequately secured loans to Missouri produce dealers, although such loans, while offered, were never actually made.'
In the negotiations with the Missouri dealers, Union Pacific’s representatives took an active part. The district court found that it and the. City acted together to induce prospective tenants “by means of offers, agreements, payments, and gifts to such defendant produce dealers and other produce dealers of free rents, reduced rents, free refrigeration, cash payments and rental credits purporting to be for the purpose of paying such produce dealers’ cost of removal from Kansas City, Missouri . . . and the value óf furniture and fixtures in their Kansas City, Missouri, places of business and the liability on unexpired leases in Kansas City, Missouri, but in some ..cases in excess of any such costs, values or liabilities.” The' opinion adds that “The testimony of several dealers with whom negotiations were conducted warrants the conclusion that the primary objective of those
The record fully supports the trial court’s conclusion that the concessions offered were not confined to fair compensation for the costs of removal, as a brief review of the instances specified by the judge will show. Mallin Produce Company, the largest apple concern in the market, claimed $17,300 as its costs of removal, $7,300 for moving its apples, and $10,000 as the “value of existing lease to be abandoned.” However, Mallin made no claim that he had any obligations under his Missouri lease;
5
he merely said that he had been assured by his landlord that he could continue the lease as long as he lived, and that he would continue to lease the property “in order to keep a competitor from securing it.” Union Pacific’s representative nevertheless offered him $15,000 from the City, and then raised the offer to $20,000 when Mallin agreed to take two units instead of one at the' terminal. The O. C. Evans Company, which made no statement of the amount of its Missouri investment, was offered $5,000; when it demanded $10,000, the offer was increased to $7,000. The negotiators increased Cherrito’s claim from $900 to $1,450 by raising the, cost figures for his Missouri fixtures above the amounts he had specified. Garrett-Holmes & Company, which had claimed only about $20,000 in the summer of 1939 without presenting definite figures, in Deceihber demanded an adjustment of $35,000, and accepted $30,500 in cash, and one year’s free refrigeration. Settlement was reached on a claim for unexpired rentals of $15,000 and cost of irremovable business fixtures, $20,-000. Litman Produce Company was given $15,000 in
The proposed cash payments to dealers totalled $111,-000, and. the proposed credits'on rent more than $30,000. When negotiations with a dealer resulted in a tentative understanding or agreement, he would be .told that Union Pacific could not pay him but that the matter would be submitted to the City. The district court’s injunction intervened before more than one of the adjustments had been formally agreed to by the City Board and none of these payments had actually been made.
. In addition to these circumstances, the standard form lease contained express provisions for free rents and reduced rents. The standard rental adopted was $150 per month per unit, but for the first three months after the official completion date only $50 was charged. Moreover, the terminal opened for business on December 4, 1939; dealers began moving in then and enjoyed rent-free occupation until February 1,1940, which was announced as the official completion date.
Union Pacific also made available a certain amount of free advertising by interviewing the terminal’s tenants, on its radio program and allowing them to describe the kind and quality of their produce.
Throughout all phases of these activities, Union Pacific’s principal and compelling motive has been to divert pro
The Applicable
Statutes. The Elkins Act is a part of the federal statutory system for the regulation of interstate carriers of commerce. As with other portions of that system a chief purpose for its enactment was to eliminate rebates, concessions or discriminations from the handling of commerce, to the end that persons and places might carry on their activities on an equal basis. With the adoption of prohibition against open rate-cutting, various der vices were resorted to.
6
The railroads sought control over competitors to escape rate wars and, despite abhorrence of monopolies even in the utility field, strong in the early years of this century, such concentrations of carrier control were thought to have one advantage at least, the reduction of discriminatory practices.
7
Concealment of the receipt or payment of rebates was made manifest. Strengthening of the enforcement provisions was sought. This effort finally culminated in the legislative authorization of the injunction as the simplest and most summary legal instrument to destroy discrimination.
8
The courts have found the statutes effective to accomplish the de
Difficulties in statutory construction arise upon further analysis of the statute. Section 1, quoted-in note 1, has a provision making it unlawful for any person to give or receive any concession in respect to transportation. A subsequent clause makes the act of giving or receiving a concession a misdemeanor and punishes its violation by “every person or corporation, whether carrier or shipper.” Obviously a bonus paid by a railway to induce a prospective shipper to locate along its line would be as much a concession under the statute as a reduction-in tariff applicable only to the favored shipper. We aré of the opinion that such, a payment by a person who is not a carrier, if it is a payment “in respect to transportation,” would be equally violative of the section in question.
The first prohibition makes it unlawful “for any person or corporation” to give or receive the concession.
This conclusion is buttressed by other language in the Elkins Act and by decisions in other courts which have dealt with the question. Section 3 authorizes such suits as this against a carrier and such other persons “as the court may deem necéssary” when a carrier is “committing any discriminations,” and the court.may enforce its orders “as well against the parties interested in the traffic” as against the carrier. For example, in
Spencer Kellogg & Sons
v.
United States,
Validity of the Plan.
Appellants urge that the City’s action in making arrangements for payments to dealers located in the Missouri city was taken solely in furtherance of its municipal interests and without intention to influence traffic and consequently not “in respect to the transportation of property.” It is pointed out that it is quite permissible and indeed desirable for a railroad,
Enough has heretofore been stated to support fully the conclusion that some shippers obtained agreements from
The power of the City to make the concessions and the question of whether any money to be used by the City was contributed directly or indirectly by the Union' Pacific do not affect this conclusion. The judgment of the Supreme Court of Kansas in
State ex rel. Parker
v.
Kansas
City,
18
that the City, in its proprietary capacity, under Kansas law has “authority to pay such sums as are necessary ... to carry out . . . such policies and transactions as may be to the best interest of said city in securing tenants ... for said Terminal” is not reviewable here. But the opinions in these Kansas cases do not consider or decide whether the proposed payments are a part of a plan to grant advantages to shippers contrary to the Elkins Act. Even if the City’s action had
Resolution 11275 was construed by the Supreme Court of Kansas to authorize disbursements of available market funds for such purposes “as in the judgment of said governing body will be to the best interests of the city.” 22 By the resolution these expenditures were limited to the dealers’ actual costs of removal, including loss of good will.
In prior sections of this opinion, it has been pointed out that any concession by any person or corporation in respect to transportation is forbidden by the federal,transportation statutes. The paragraph of the injunction now
“The proposed payments to Missouri dealers to induce them to move to the new market not being made to all tenants at the new market and being in the nature of bonuses the amount of which was not based on actual loss or expense, fall within the classification of discriminations prohibited.by the Elkins Act.”
The words of the injunction, however, go farther and forbid payments even though the payments are in all fairness and strictness limited to actual and necessary expenses and losses in moving an establishment. Consequently, in deciding the form of the injunction, we need to determine the breadth of language necessary “to suppress the unlawful practices” and preclude their revival. 23 The district court summarized in findings of fact and conclusions of law the constant activity of the Union Pacific in pressing forward the idea of the Terminal. It had before it the testimony that the road sought, meticulously, to avoid conflict with the Elkins Act and yet gain the installation of the market; /that the railway representatives acted with the City committees and talked with prospective tenants. Railroad influence pervaded each City action and, in those circumstances, the decree must be molded to meet the danger of subtle moves against the equality between shippers .guaranteed by the Elkins Act.
Where, as here, the action of the City in giving cash and rental credits is, as we have decided, a part of a plan in ré-
Another prohibition of the injunction determines that the rates for space shall be such “which will yield a proper rate of return upon the full value of the market facilities as a whole, after making provision for all expenses of operation, including maintenance and depreciation."
24
Identical language in paragraph Third (2) of the injunc-'
The preliminary injunction referred to in the excerpt from the final injunction quoted in note 24 set the rentals at not less than certain definite amounts per month and per annum for operating unite and office space. There were allowances for uncompleted facilities not now important. No issue is raised here as to whether the sums fixed were or were not a fair rental value. Adequate findings determined the values of the facilities, the estimated gross and net revenues and rates of return. With these findings before it, the district court further found in its final order , that the rates fixed in the- preliminary injunction were compensatory and- did not amount “to a gift of any part of the value of the use of the Food Terminal to the tenant shippers.”
25
This result is not
“42. The net return, while low as compared to the fair return of many privately owned utilities devoted to the service of the public, is compensatory and, in view of the purpose of the City to bring about industrial improvement and the incidental advantage to the City for that purpose and the return generally obtained from investments in utilities of like or similar nature, the present rental rates and the consequent return to the City are not so low that the use of the Food Terminal by tenants in interstate commerce at those rentals will amount to a gift of any part of the value of the use of the Food Terminal to the tenant shippers.”
Fair rental value rather than a compensatory return upon full value of the market facilities is the standard by which the City’s schedule of rates is to be judged. To determine fair rental value, the going rates of rental for similar facilities in the community are significant, as aré the rentals prospective tenants are willing to pay. Likewise, evi
This is not the case for a rigid rule that aggregate rentals are to equal costs, such as was applied in
Baltimore & Ohio R. Co.
v.
United States,
With the modifications directed in this opinion, the order of the district court is
Affirmed.
I cannot agree with the judgment in this case. In last analysis the question presented is whether the Elkins Act proscribes'financial transactions by a city with proposed occupants of a city-owned building because those occupants will be shippers in interstate commerce from such building, where the city is to furnish no facilities or services of transportation, where the transactions involve no payments,* concessions or discriminations on the part of any interstate carrier, are authorized by state law and are for the city’s benefit. A subsidiary question is whether in fact the proposed transactions amount to discriminations in favor of such occupants. A further question is presented with respect to the decree to be entered.
I find it unnecessary to, discuss the evidence in detail, or narrowly to examine the findings. I shall endeavor, for the purpose of reaching the legal questions, to consider the case in the light most favorable to the appellees.
The defendants DeOreo and Fean are not philanthropists but promoters who had more or less successfully promoted produce terminals in various cities. They conceived theplan of establishing one in Kansas City, Kansas. They expected a profit out of the venture. Their original idea was that they should become lessees of the terminal and make their profit by sub-renting space .in it. When this purpose was abandoned they sought to be made exclusive rental agents. Objection by the'P. W. A. rendered this proposal impracticable. They have received considerable payments from Union Pacific for their efforts in connection with the establishment of the terminal.
DeOreo and Fean presented their plan to Union Pacific. That company took an interest, not eleemosynary but practical, in the project. Inasmuch as its tracks would serve the proposed terminal, the railroad naturally desired that the plan go through so that it might get in
Some years ago Kansas City, Kansas, had been given a large tract of water-front land .which, until recently, had been unused. Through a P. W. A. grant and a loan from Reconstruction Finance Corporation, the city had made some improvements and had erected-a grain elevator and docks on the tract which were served by the lines of Union Pacific and Missouri Pacific. The balance of the tract was available for a produce terminal. The establishment of such an instrumentality would obviously be of great benefit to the city in both financial and civic aspects. The plan evolved was that the city should erect such a terminal; that Union Pacific would construct a large team track and switching. yard' on the ground adjacent to the terminal to be leased by Union Pacific from the city and that , the terminal should be financed by the city through a P. W. A. grant and income bonds.
DeOrecy and Fean, Union Pacific, and the city officials all struggled earnestly to obtain a grant from P. W. A. An investigation by the Department of Agriculture disclosed that the terminal would be highly beneficial to the producers tributary to the Kansas City market. Investigation by the P. W. A. disclosed that the scheme was desirable and practicable. A grant of not to exceed $1,700,-000 was made, conditioned on the financing of the remainder of the project.
Union Pacific and the city officials negotiated with an underwriting house for the sale, by the city, of $3,000,000 of income bonds, $1,033,000 of which were to be used to pay off the outstanding bonds, and the balance for the erection of the terminal. Although a firm commitment
The condition precedent to the P. W. A. grant having been fulfilled, the city proceeded with the erection of the terminal with the fullest aid and cooperation of Union Pacific. That company had advanced some $22,000 for preliminary expenses, which the city proposed to repay it. Under a ruling of P. W. A. the city could not do so with funds procured for construction, and if the sum is repaid the funds must come out of income. The railroad, not unnaturally, retained an architect to collaborate with the city’s architect respecting the construction and exerted every effort to bring the plan to fruition.
In Kansas City, Missouri, there was an,existing wholesale produce market. This needed extensive alterations and additions and the expectation was that many of the tenants would move to the new and more convenient terminal in Kansas City, Kansas. All who were interested in the latter realized that tenants of the old one .in Missouri might incur expense in giving up their quarters and moving to the new. They realized also that, in order promptly to fill the new building, some concessions in
As was expected, tenants of the old market in Missouri, when solicited to move to the new, raised questions of losses due to unexpired leases, abandonment of fixtures, etc. Everybody interested in the new terminal, including DeOreo and Fean, employes of Union Pacific, and representatives of the city, negotiated with these prospective tenants in respect of what would be a fair recompense for their losses due to removal and reestablishment. None of these negotiators had authority to do more than ascertain the claims of such proposed tenants, which were to be submitted to, and adjusted by, ■a committee representing and acting for Kansas City, Kansas. The evidence is uncontradieted and overwhelming that Union Pacific’s employes, and everyone else concerned, made it clear that any adjustment of these losses would have to be made by the city, and by the city only; that the railroad could not, and would not, pay a cent towards any such expense.
At an early day in the development of the project, Union Pacific expressed its willingness to switch all consignments in and out of the terminal to and from other railroads at a uniform and fair charge. It filed a switching tariff with the Interstate Commerce Commission which has been accepted and is concurred in by the other railroads. The tariff is the same as that which has been in force for similar service in Kansas City, Missouri. Thus, all railroads and shippers are to be served indifferently and at a uniform and fair rate for the transportation services involved.
On these facts the question is whether the actions of the railroad, those of the city, or those of the two jointly, constitute a rebate or a discrimination within the meaning of the Elkins Act. 3
1. It has always been understood that one of the purposes of the interstate commerce law was to prevent a
Every decision applying the relevant provisions of the Interstate Commerce Act and the Elkins Act has turned upon the fact that someone furnishing a service of transportation covered by a tariff has remitted a part of the tariff charge, or. has rendered a free service, or a service below cost to some shippers which others did not enjoy; and where one not a carrier has been held guilty of a violation of the Act it has been because he returned to the shipper, through one performing a part of the transportation service covered by the carrier’s tariff, part of the published rate, or has induced the carrier to perform a service for the shipper covered by the tariff at less than the published rate, or has induced the carrier to perform a transportation service for a shipper to which the shipper was not entitled under the published tariff and which, therefore,, the carrier failed to perform for others.
The District Court, sensible of this unbroken line of authority, thought it necessary , to attribute the proposed payments in some way to Union Pacific. To reach this result, it held that in the terminal enterprise Union Pacific and Kansas City were joint adventurers. Obviously the conclusion is incorrect. Union Pacific was in no sense a partner and did not stand to make a profit from the conduct of the enterprise. It was a lessee of a part of the property for its freight yard at an adequate rental. It
In the second place, the District Court held that Union Pacific and the city were in a conspiracy to grant compensation to prospective tenants. But this is not equivalent to finding that the purpose of the conspiracy'was to grant transportation to these tenants at less than the tariff rates of Union Pacific. Inasmuch as it is conceded that there was no purpose to grant any shipper any service not granted to others, or to give any shipper a rebate from the published tariff rates, it seems plain that the latter sort of conspiracy is not made out.
Finally, the District Court sought to spell out a financial contribution by Union Pacific for the benefit of proposed tenants by what it denominated the waiver of the lien of the bonds held by the railroad on the terminal property An examination of the decision of the Supreme Court of Kansas 4 makes it clear that, under the law of that State, the railroad had no lien, in any proper sense of the term. The state court held that the obligation of the city under the bonds was to devote the net profits of the enterprise to the payment of the principal and interest, but that it was at liberty to pay all necessary operating expenses, including the expenses of obtaining tenants. I do not understand that the opinion of this court approves the finding and conclusion of the District Court in this respect.
The ruling here is much broader, and does not condition violation of the law on any payment or concession by Union Pacific. It is that if the city, which is not a shipper, nor a carrier, and not a furnisher of any transportation service, in dealing with its own property not
I venture to think that no one will be more surprised than the members of the Congress at the attribution of the statutory phrase “every person” who gives or receives, grants or solicits rebates or discriminatory service, to states and municipal corporations and their officers who, in promoting lawful municipal purposes, incidentally bring additional business to an interstate carrier. We know that it is a common practice for chambers of commerce and city authorities to offer to manufacturing and business concerns lands and sites on favorable terms, such as low purchase price, reduced rentals, exemption from taxation for a given period, in an effort to induce such concerns to locate within the limits of a municipality.
We know that, in order to induce men to move their plants from one location to another, it is a practical necessity to offer them some recompense for the expense involved and for the loss which may result from doing business in a new location. Under the decision now announced, citizens or city officials connected with such- a transaction, though their purpose be wholly remote from any benefit to a railroad, are guilty of a criminal offense.
The opinions of the court below and of this court point out that, as a result of the consummation of the plan.for a terminal, Union Pacific expected to carry greatly increased traffic into and out of Kansas City and that this increase necessarily would inflict losses upon its competitors. But the Elkins Act and the Interstate Commerce Act were aimed at specific abuses, and were not general prohibitions of all forms of competition between carriers or limitations on the increase of a carrier’s traffic by any sort of competition. In fact, the Congressional policy is to foster and encourage competition between railroads, and to prohibit agreements or conspiracies to suppress it.
5
It is common knowledge that carriers customarily advertise the advantages of sites lying along their lines in the hope of encouraging shippers to locate thereon. It seems to me that the circumstance so pointedly noticed is irrelevant to any question involved in this case. Of course, Union Pacific was actuated by the legitimate desire of increased traffic in all its efforts towards the establishment of the terminal. That avowed motive was,- in my- judgment, innocent and lawful. Moreover,
2. Assuming, as the opinion does, that the city and its officers were, within the meaning of the Act, persons “acting for” Union Pacific, the proof fails to disclose that the sum proposed to be paid to any produce merchant in connection with his moving to the new terminal was in fact more than fair compensation for loss or was a discrimination against any other tenant. There is no proof, and indeed it would be very difficult to furnish any, that at the end of one, two, or three years of business at the new terminal, — considering the attendant expense of moving and reestablishing the business at the new location, the incident loss of good will and custom, and the necessity of finding new custom to take the place of that lost, — the balance sheet of any of the tenants would disclose that he was better off than if he had stayed in his old location. And it would be even more difficult to determine that a sum paid him to cover such loss and damage is reflected upon his books in the transportation charges paid by him, rather than in the other items of expense connected with his business. How shall any. such allocation be made? None such is necessary where the carrier itself, or someone representing it, grants a concession from the published rate or renders a service not comprehended in its tariff. In such case the fact speaks for itself. In this case the court assumes the fact and, by a blanket and sweeping decree, bans any compensation, however just, to anyone for removing from an old location to the new terminal on the suspicion that the payee may have some advantage over another tenant who did not incur any such expense. Thus the decree will render it impossible for Kansas City to make what it deems legitimate and proper arrangements for the prosecution of a business enterprise in no sense consisting of the service of transportation. It i eems clear that Congress never had any such intent in adopting the
3. Another feature of the decree seems to me to be equally unjustified. The record discloses that the city adopted a standard form of lease which fixed a uniform rental per unit of space. In order to fill the building promptly, this lease provided that for the first three months the monthly rental should be one-third of the standard monthly rental. Thus a tenant who, after the three months, would pay $150 a unit would get the use of that unit for the first three months for $50. It is again common knowledge that, in a competitive situation, the owner often has to make rental concessions for a brief time at the beginning of the lease term. There is nothing unlawful about this ana the decision of the Supreme Court of Kansas sanctions it. The court below swept aside all these arrangements and, although it found-“the present rental rates and the consequent return to the City are not so low that the use of the Food Terminal by tenants in interstate commerce at those rentals will amount to a gift of any part of the value of the use of the Food Terminal to the tenant shippers,” it nevertheless required that the rentals must be such as to allow a fair return to the city on the total value of the premises including the product of the money granted by P. W. A. and the land acquired by free gift. Under the law, the city was at liberty to turn this land to account in such manner and at such rate of return as it might see fit. While the opinion of the court holds this provision of the decree erroneous, it substitutes what I think an equally improper rule. The city is to be prohibited from leasing its own publicly owned property, in the prosecution of an enterprise which it deems beneficial to the community, at rates it deems proper and rates
I am of opinion that the bill should have been dismissed.
Notes
Section '1 (1) of the Elkins Act (32 Stat. 847; 34 Stat. 587; 49 U. S. C. § 41 (1)), so far as pertinent here, provides:
“Anything done or omitted to be done by a corporation common carrier, subject to chapter 1 of this title, which, if done or omitted to be done by any director or officer thereof, or any receiver, trustee, lessee, agent, or person acting for or employed by such corporation, would constitute a misdemeanor under said chapter or under sections 41, 42, or 43 of this title, shall also be held to be a misdemeanor committed by such corporation, and upon conviction thereof it shall be subject to like penalties as are prescribed in said chapter or by sections 41, 42, or 43 of this title, with reference to such persons, except as such penalties are herein changed. The willful failure upon the part of any carrier subject to said chapter to file and publish the tariffs or rates and charges as required by said chapter, or strictly to observe such tariffs until changed according to law, shall be a misdemeanor, and upon conviction thereof the corporation offending shall be subject to a fine of not less than $1,000 nor more than $20,000 for each offense; and it shall be unlawful for any person, persons, or corporation to offer, grant, or give, or to solicit, accept, or receive any rebate, concession, or discrimination in respect to the transportation of any property in interstate or foreign commerce by any common carrier subject to said chapter whereby any such property shall by any device whatever be transported at a less rate than that named in the tariffs published and filed by such carrier, as is required by said chapter, or whereby any other advantage is given or discrimination is practiced. Every person or corporation, whether carrier or shipper, who shall, knowingly, offer, grant, or give, or solicit, accept, or receive any such rebates, concession, or discrimination shall be deemed guilty of a misdemeanor, and on conviction thereof shall be punished by a fine of not less than $1,000 nor more than $20,000: Provided, That any person, or any officer or director of- any corporation subject to the provisions of sections 41, 42, or 43 of this title or of chapter 1 of this title, or any receiver, trustee, lessee, agent, or person acting for or employed by any such corporation, who shall be convicted as aforesaid, shall, in addition to the fine herein provided for, be liable to imprisonment in the penitentiary for a'term of not exceeding two years, or both such fine and imprisonment, in the discretion of the court. . . .”
32 Stat. 848; 36 Stat. 1167; 49 U. S. C. § 43:
“Whenever the Interstate Commerce Commission shall have reason
Cf.
United States
v.
Chicago North Shore R. Co.,
The City- spent an additional $149,000 from its general revenues for street and sewer improvements in the terminal area. '
Further, Mallin had sublet part of the property, and at the time had a net rental expénse of no more than $25 per month.
1897 Annual Report, I. C. C., 47.
1900 Annual Report, I. C. C., 13.
1902 Annual Report, I. C. C., 8-10; 32 Stat. 848.
New York, N. H. & H. R. Co.
v.
Interstate Commerce Comm’n,
Armour Packing Co.
v.
United States,
Baltimore & Ohio R. Co.
v.
United States,
United States
v.
Union Stock Yard Co.,
34 Stat. 584, 588; 40 Cong. Rec.7022.
See
Interstate Commerce Commission
v.
Reichmann,
Southern Pacific Terminal Co.
v.
Interstate Commerce Commission,
United States
v.
Union Stock Yard Co.,
Baltimore & Ohio R. Co.
v.
United States,
Houston & Texas Ry. Co.
v.
United States,
The difficulty is shown by the district court’s language in finding 34:
“The City’s forecast of its ability to pay off the bonds in twenty-two years is based upon a ninety percent occupancy of the market facilities as compared with an actual percentage of occupancy of less than thirty-five percent at the present time, and there is assumed an ability to exact the same level of rentals when the market buildings become twenty-five or thirty years old a,s at the present time when they are new. The City’s estimate of operating expenses is unduly low by reason of the omission of any sums to. cover the annual loss due to depreciation and obsolescence not made- good by current maintenance.
“The defendant City will derive no immediate direct financial benefit from the operation of the Kansas City Food Terminal. The Union Pacific, by reason of the anticipated improvement of the volume of its traffic in perishable produce and consequent increase in its revenues, will receive an immediate and continuing benefit from the project.”
This provision reads: “(1) From offering, granting, or giving, or assisting, joining, or co-operating in offering, granting, or giving cash payments or rental credits, free rents, and reduced rents, unsecured or inadequately secured loans constituting concessions, or other valuable considerations to defendant produce dealers or other produce dealers, or produce brokers or other persons, firms, or corporations shipping produce by railroad in interstate commerce to move or for moving to the Kansas City Food Terminal or for leasing space or remaining as tenants in said food terminal.”
State ex rel. Parker
v.
Kansas City,
Ethyl Gasoline Corp.
v.
United States,
The full paragraph enjoins the Union Pacific and the City of Kansas City, Kansas, and their officers and employees,
“(2) From permitting defendant produce dealers or other produce dealers, or produce brokers or other persons, firms, or corporations shipping or receiving traffic by railroad in interstate commerce to occupy or remain as tenants of the wholesale produce buildings or of other facilities at the Kansas City Food Terminal unless said produce dealers, produce brokers, or other persons, firms, or corporations— (a) shall pay rental for past oecupancy of such facilities under the pro-. visions of the temporary restraining order and the preliminary injunction heretofore entered, in this cause, and (b) shall-.pay rental hereafter for such facilities at the same rate charged all other shippers occupying similar facilities at said Terminal, which does not .amount to a rebate or concession to any tenant, and which will yield a proper rate of return upon the. full value of the market facilities as a whole, after making provision for all expenses of operation, including maintenance and depreciation. Provided further that nothing contained in this decree shall be construed to .limit the City in the renting of said facilities to a unit basis; but in- no event shall the rates of rental and charges prescribed for such facilities aggregate less than is hereinabove provided.” -
These ultimate findings are as follows:
“41. The uniform or standard rates of rental adopted and approved by Kansas City, Kansas, for lease of warehouse spáce and office space at the Kansas City Food Terminal are $150.00 per month per unit and $1.10 per square foot per annum, respectively, and the average rate of rental adopted or approved by Kansas City, Kansas, for lease of the cold storage plant and appurtenant facilities at said1Food Terminal is $38,497 per annum. Such rentals are intended to provide sufficient funds to amortize the principal and. pay the interest oh the Public Levee Revenue Bonds purchased by the defendant Union Pacific Railroad Company, representing 55-percent of the total cost of construction of the said Food Terminal, and to compensate the City for the use of the facilities for the'purpose to which they are dedicated.
Cf.
Palmer
v.
Connecticut Ry. & Lighting Co.,
State ex rel. Beck
v.
Kansas City,
State ex rel. Parker
v.
Kansas City,
49 U. S. C. § 41 (1).
Note 2, supra.
United States
v.
Trans-Missouri Freight Association,