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WESTERN UNION DIV.

May 24, 1949

WESTERN UNION DIVISION, COMMERCIAL TELEGRAPHERS' UNION, A.F. OF L.
v.
UNITED STATES et al.



The opinion of the court was delivered by: TAMM

Plaintiff, a national labor union representing affected employees, brings this action to set aside, annul and permanently enjoin the enforcement of an Order and Authorization adopted by the Federal Communications Commission on May 27, 1948 and issued on June 7, 1948, which Order and Authorization granted an application of the Western Union Telegraph Company for authority under Sec. 214 of the Communications Act of 1934 *fn1" to discontinue its operation of six Class 1-B telegraph offices, and to substitute in lieu of Western Union operation, an agency office to be operated by the respective local telephone company operating in each community. The intervenor-defendant, The Western Union Telegraph Company, is a corporation engaged in furnishing public telegraph communication in the six communities in Ohio which are involved in this application, as well as at various points throughout the United States and in some foreign countries.

The jurisdiction of this Court rests on the provisions of Section 402(a) of the Communications Act of 1934, as amended, *fn2" incorporating therein certain provisions of the Urgent Deficiencies Act of October 22, 1913 *fn3" relating to the enforcing and setting aside of the Orders of the Interstate Commerce Commission and Title 28, United States Code Annotated, Sections 1398, 2284 and 2321-2325 revising, reenacting and codifying certain provisions of said Act of October 22, 1913.

 The statutes involved are Section 214 of the Communications Act of 1934, as amended by Public No. 4, 78th Congress, 1st Session, approved March 6, 1943, 57 Stat. 11, 12; Act July 26, 1947, c. 343, Sec. 205(a), 61 Stat. 501 *fn4" ; and Sections 7 and 8 of the Administrative Procedure Act, 60 Stat. 241, 242 *fn5" .

 The plaintiff in its Complaint charges that the Federal Communications Commission in insuring its Order and Authorization of June 7, 1948 acted in an 'illegal and void' manner for the reasons that:

 '1. The Order and Authorization is contrary to the anti-monopoly laws.

 '2. The Telephone Company of Ohio is not a proper agent.

 '3. Plaintiff was not accorded a fair hearing, in that there was considered as evidence, by the Commission, matter not in the record.

 '5. The Commission has disregarded its own findings in order to achieve a result violative of law.

 '6. The Order and Authorization are contrary to the public interest and do not meet the requirements of Section 214 of the Communications Act of 1934 as amended.

 '7. The Order of the Commission of May 27, 1948 issued simultaneously with and as a part of its disposition of Exhibits 'A' and 'B' is an abuse of the Commission's discretion and is arbitrary and improper.'

 The intervenor-defendant, Western Union Telegraph Company, filed a motion to dismiss the Complaint on the ground that the plaintiff lacked legal capacity to maintain this action. The Government filed a motion for summary judgment on the pleadings and exhibits. Oral argument was heard by the Court on April 12, 1949, counsel having previously stipulated that the parties were in complete agreement as to the facts, and that arguments before the Court would relate only to the question of law arising from the stipulated facts. Briefly stated the facts in this case are as follows:

 The application which initiated the proceedings resulting in the Commission Order of May 27, 1948, was filed by Western Union with the Federal Communications Commission on December 27, 1946 and amended pursuant to motion filed May 28, 1947. In the application, Western Union requested authority to close its main office at each of six communities in Ohio and to substitute, in lieu thereof, service through a teleprinter-operated agency office to be established in the office of, and to be operated by, the respective local telephone company operating in each community. Such telephone companies are managed by The Telephone Service Company of Ohio. Under the terms of a contract between Western Union and The Telephone Service Company of Ohio on behalf of itself and the companies under its management, the respective telephone companies, upon a grant of this application, will provide telegraph service as agents of Western Union in each of the six communities involved. In addition, it is also provided in the contract that telephone companies under the management of The Telephone Service Company of Ohio will act as Western Union agents in 116 communities adjacent to the six involved in this application.

 At the time of the merger of Postal Telegraph, Inc., and Western Union in October, 1943, Postal had a number of agency agreements with telephone companies serving various communities in Ohio, functioning under the management of The Telephone Service Company. Under the terms of these agreements the telephone companies furnished 24-hour telegraph service to various Ohio communities through a combination of direct office representation and subscriber telephone stations. At certain of these places, including the six communities in the instant application, Western Union also maintained company-operated offices. Subsequent to the merger, when the operations of the Postal and Western Union were integrated, Postal's agreements with The Telephone Service Company of Ohio were kept in effect by Western Union in order to continue the rendition of 24-hour telegraph service in these communities, not then available at the Western Union offices. *fn6" According to the application filed with the Federal Communications Commission and testimony offered by the Western Union Telegraph Company at the hearings held on this application, the telephone companies did not realize sufficient revenue from the handling of telegraph traffic after the merger to justify continued participation in telegraph operations under the arrangements then in effect. On May 8, 1946, Western Union concluded an agreement with The Telephone Service Company, and it is to effectuate this agreement that the application was filed.

 Essentially, the plan is to relocate the teleprinter and associated telegraph equipment presently in use in Western Union's company-operated offices in the commercial offices of the respective telephone companies where the equipment would be operated by personnel trained by Western Union but employed by and under the direct supervision of the telephone company.

 After the filing of the application by Western Union Telegraph Company with the Federal Communications Commission a hearing upon the application was held in Mt. Gilead, Ohio, one of the communities involved, on May 14 and 15, 1947, pursuant to the Commission's ...


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