No. 27756

CHAMPION PANTS MANUFACTURING COMPANY, INCORPORATED, v. LEHIGH VALLEY RAILROAD COMPANY ET AL.

Submitted March 3, 1938. Decided April 22, 1938

Rate applicable on lumber jackets, or "windbreakers," in less than carloads, from Baltimore, Md., Shenandoah, Pa., and Perth Amboy, N. J., to Fort Mason, San Francisco, Calif., found not unreasonable. Complaint dismissed. Lewis H. Rubin and William J. Augello for complainant.

G. H. Muckley, H. B. Light, J. R. Bell, and J. E. Lyons for defendants.

REPORT OF THE COMMISSION

DIVISION 2, COMMISSIONERS AITCHISON, SPLAWN, AND CASKIE BY DIVISION 2:

Exceptions to the report proposed by the examiner were filed by complainant.

Complainant, a corporation, alleges by complaint filed May 27, 1937, that the rate applicable on 132 less-than-carload shipments of lumber jackets, or "windbreakers," which moved between August 20, and November 4, 1935, from Baltimore, Md., Shenandoah, Pa., and Perth Amboy, N. J., to Fort Mason, San Francisco, Calif., was unreasonable. Complainant asks us to award reparation and to authorize waiver of collection of outstanding undercharges. It does not ask us to prescribe rates for the future. Rates and emergency charges will be stated in amounts per 100 pounds. Rates indicated herein as present rates are those in effect at the time of the hearing.

Of the considered shipments, 40 originated at Baltimore, 45 at Perth Amboy, and 47 at Shenandoah. They ranged in weight from 220 to 4,350 pounds, aggregated 275,797 pounds, and averaged approximately 2,089 pounds. The garments constituting these shipments were sold to the United States Government for delivery to the Quartermaster General at Fort Mason, San Francisco, under specifications that called for "windbreakers" of first grade, made of woven woolen cloth of a plaid pattern, not less than 95 percent wool, with an elastic webbing on the bottom and a shawl collar. As shipped, the garments weighed 10.5 pounds per cubic foot and their value, based on the 227 I. C. C.

selling price of $2.84 per garment, was slightly in excess of $1.08 per pound.

Charges were collected on the shipments from Baltimore and Perth Amboy and on 10 of the shipments from Shenandoah at a joint commodity rate of $4.80 maintained on clothing, not otherwise specified, in less than carloads, and an emergency charge of 11 cents. The remaining 37 shipments from Shenandoah were charged at a joint commodity rate of $3.75 maintained on woolen bathrobes and certain other woolen articles, in less than carloads, in addition to the 11-cent emergency charge. Complainant's product was not included in the list of articles on which the $3.75 rate was named and it is clear, as complainant concedes, that the rate of $4.80 was applicable on all the shipments considered. The shipments moved over defendants' lines for distances of 3,140 to 3,359 miles and, based on those distances, the $4.80 rate yielded ton-mile earnings that ranged from 28.57 to 30.66 mills.

Complainant contends that the assailed rate of $4.80 was unreasonable to the extent that it exceeded $3.75, based primarily upon the decisions hereinafter referred to and a comparison of the value of the considered commodity with the values of certain other woolen garments.

Rates of $3.75 were and are maintained from points in transcontinental group A, including Baltimore, Shenandoah, and Perth Amboy, to destinations on the Pacific coast, including San Francisco, on woolen bathrobes, knit woolen caps or hats, children's woolen suits and sleeping garments, woolen hosiery, woolen cardigan jackets, woolen mufflers, woolen shirts, woolen bathing suits, woolen sweaters, woolen blankets, comforters, automobile robes, and steamer rugs. Cardigan jackets (knit sweaters) are somewhat similar to and, together with woolen shirts, may be used for the same purpose as lumber jackets. Complainant introduced in evidence a cardigan jacket and woolen shirt for which it paid $4 and $3.94 respectively. Those are retail sale prices at New York, N. Y., in November 1937, whereas the value given for lumber jackets is the Government contract price for large quantities at San Francisco in 1935. With this exception no evidence was submitted as to value, volume of movement, or other transportation characteristics of the compared commodities.

It is emphasized by complainant that in Pacific Embroidery Co., Inc., v. Erie R. Co., 132 I. C. C. 679, division 4 found a rate of $4.80 on rayon, in less than carloads, valued at $2.08 per pound, from New York, N. Y., to San Francisco unreasonable to the extent that it exceeded $3.75; and that in Woolen Clothing from California, 161 I. C. C. 713, division 3 found, among other things, that schedules which proposed to increase to $4.80 a joint commodity rate of $3.75

on woolen clothing, in less than carloads, from California and north Pacific coast points to group A destinations had not been justified. In the proceeding last cited, respondents stressed the fact that on less-than-carload shipments of woolen clothing between the same points in the reverse direction the rate was $4.80, and in its report therein division 3 stated that the issue of the reasonableness of the latter rate was then pending before the Commission in Docket No. 22308. However, in its report in the latter proceeding, Desmond's v. Atchison, T. & S. F. Ry. Co., 168 I. C. C. 397, division 3 found not unreasonable the rate of $4.80 on westbound movements of men's and boy's woolen clothing, in less than carloads, from points in group A to destinations in California and Arizona. The average shipping weight of that clothing was 18.2 pounds per cubic foot and the average value was $2.88 per pound.

Clothing, not otherwise specified, in less than carloads, was and is rated first class in the official, southern, and western classifications. When the shipments moved, the first-class rate from and to the points here considered was $5.55. It is defendants' position that this firstclass rate would not have been unreasonable for application on complainant's less-than-carload shipments. They assert that both the $4.80 rate assailed and the rate of $3.75 on the woolen garments named by complainant for comparison were established and maintained at subnormal levels in order to meet competition through the Panama Canal. From August 26, 1920, to June 30, 1922, inclusive, the rate on the traffic considered was $6.255; on July 1, 1922, it was reduced to $5.63; on July 24, 1924, it was reduced further to $4.80; and on January 1, 1937, it was increased to $4.91 by adding to the basic rate the emergency charge that applied from April 18, 1935, to December 31, 1936, inclusive. According to defendants, the reduction on July 24, 1924, was made because of water competition. Excepting transcontinental traffic to Pacific coast ports, lumber jackets, in less than carloads, move on first-class rates.

In support of the reasonableness of the assailed rate, defendants refer to proceedings in which the Commission has prescribed or approved first-class rates on less-than-carload shipments of commodities that have transportation characteristics as favorable as, or more favorable than, those of complainant's product. For example, firstclass rates have been prescribed on electric switches valued at 42 cents per pound which have a weight density of 30 pounds per cubic foot; on automatic windshield cleaners with values ranging from $1.20 to $1.40 per pound and weight densities ranging from 20 to 30 pounds per cubic foot; and on electric table stoves valued at 98 cents per pound and weighing 16.6 pounds per cubic foot. We have heretofore found that for freight ranging in value from 40 to

70 cents per pound, a rating of first class for less than carloads is not unreasonably high. Chemicals, Acids, and Dyestuffs, 177 I. C. C. 529, and proceedings therein cited.

In the report on rehearing in Arnstein Simon & Co. v. Atchison, T. & S. F. Ry. Co., 164 I. C. C. 541, the Commission found a rate of $4.80 on woolen cloth in the original piece, in less than carloads, from New York to San Francisco not unreasonable. The average value of that commodity was $1.87 per pound. It was emphasized by complainant in that proceeding that in Pacific Embroidery Co., Inc., v. Erie R. Co., supra, division 4 had prescribed a rate of $3.75 on rayon, in less than carloads, from New York to San Francisco and that rates of $3.75 were maintained from and to the same points on woolen blankets in rolls and numerous articles of clothing, in bales, in less than carloads, including woolen knit caps, hosiery, cardigan jackets, mufflers, and similar garments.

In Hart Silk Co. v. Erie R. Co., 168 I. C. C. 357, division 3 found not unreasonable a rate of $4.80 on mixed cotton and rayon piece goods, in less than carloads, from Paterson, N. J., to San Francisco and Los Angeles, Calif. Complainant therein sought reparation to the basis of a rate of $3.75, and in support of that position relied solely on Pacific Embroidery Co., Inc., v. Erie R. Co., supra. In J. C. Penney Co., Inc., v. Alabama G. S. R. Co., 206 I. C. C. 115, division 4 found, among other things, that a rate of $4.80 on clothing, not otherwise specified, and woolen blankets, in less than carloads, from transcontinental group A points to destinations on the Pacific coast was not unreasonable.

We find that the rate of $4.80 applicable on the considered shipments was not unreasonable. The complaint will be dismissed.

227 I. C. O.

No. 278031

FLOYD-WELLS COMPANY v. NEW YORK CENTRAL RAILROAD COMPANY ET AL.

Submitted March 17, 1938. Decided April 22, 1938

Rate on so-called-industrial sand, in carloads, from Selkirk, N. Y., to Royersford, Hamburg, and Middletown, Pa., prior to July 1, 1935, not shown to have been unreasonable. Complaints dismissed.

W. H. Neely for complainants.

C. A. Halpin for defendants.

REPORT OF THE COMMISSION

DIVISION 2, COMMISSIONERS AITCHISON, SPLAWN, AND CASKIE BY DIVISION 2:

No exceptions were filed to the report proposed by the examiner. Complainants are corporations manufacturing stoves and castings at Royersford, Hamburg, and Middletown, Pa. By complaints filed July 13 and 15, 1937, they allege that the rates charged on shipments of so-called industrial sand, in carloads, to Royersford, Hamburg, and Middletown from Selkirk, N. Y., were unreasonable. Informal complaints were filed on January 16 and 22, and April 29, 1936, and closed January 14 and 16, 1937. Complainants seek reparation on shipments moving during respective statutory periods prior to July 1, 1935. Rates will be stated in amounts per net ton, and do not include any emergency charges.

The shipments were all routed by the shipper, moved in box cars, and the freight charges were paid and borne by complainants at the applicable rate of $2.90. Twelve shipments, aggregating 1,343,740 pounds, moved to Royersford, 247 miles; eight, aggregating 820,530 pounds, to Hamburg, 291 miles; and nine, aggregating 560,640 pounds, to Middletown, 314 miles. Complainants contend that the $2.90 rate was unreasonable to the extent that it exceeded $2.40 to Royersford, and $2.60 to Hamburg and Middletown, which were the rates under the so-called appendix H, scale II, bases prescribed in Industrial Sand Cases, 188 I. C. C. 99, 138. The sand here concerned is described as "moulding sand" in complainants' exhibits but no

1 This report also embraces No. 27803 (Sub-No. 1), Berks Foundry & Manufacturing Company v. New York Central Railroad Company et al., and No. 27803 (Sub-No. 2), Wincroft Stove Works v. New York Central Railroad Company et al.