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TWA v. FEDERAL ENERGY OFFICE

July 29, 1974

TRANS WORLD AIRLINES, INC., Plaintiff,
v.
FEDERAL ENERGY OFFICE and John C. Sawhill, Administrator Federal Energy Office, Defendants



The opinion of the court was delivered by: CORCORAN

 A. The Parties

 CORCORAN, District Judge.

 The plaintiff, Trans World Airlines, Inc. ("TWA") is an air carrier operating under certificate of public convenience and necessity issued by the Civil Aeronautics Board pursuant to Section 401 of the Federal Aviation Act of 1958 (49 U.S.C. § 1371).

 The defendant John C. Sawhill is the Administrator of FEO.

 B. The Nature of the Action

 This action arises under the Petroleum Act and involves the interpretation and validity of regulations promulgated by FEO effective January 14, 1974 with respect to the pricing of aviation fuel (10 C.F.R., Part 210, and Part 212; 39 Fed.Reg. 1924, et seq.)

 TWA challenges the FEO pricing regulations insofar as they relate to so-called "domestic fuel" used principally on flights within the United States (as distinguished from so-called "bonded fuel" used principally on international flights). TWA seeks preliminary and permanent injunctive relief against the enforcement of such regulations. *fn1"

 C. The Petroleum Act

 In November of 1973, Congress determined that "a national energy crisis" existed and enacted the Petroleum Act to cope with it.

 Congress declared:

 
The purpose of this Act is to grant to the President of the United States and direct him to exercise specific temporary authority to deal with shortages of crude oil, residual fuel oil, and refined petroleum products or dislocations in their national distribution system. The authority granted under this Act shall be exercised for the purpose of minimizing the adverse impacts of such shortages or dislocations on the American people and the domestic economy. 15 U.S.C. § 751(b).

 The President was given 15 days to promulgate regulations providing for the mandatory allocation of crude oil, residual fuel oil and refined petroleum products in amounts and at prices to be specified in the regulations [ 15 U.S.C. § 753(a)].

 To the extent here relevant, the regulations were to achieve, to the maximum extent practicable, each of the following objectives:

 
(A) protection of public health, safety, and welfare (including maintenance of residential heating, such as individual homes, apartments, and similar occupied dwelling units), and the national defense;
 
(B) maintenance of all public services (including facilities and services provided by municipally, cooperatively, or investor owned utilities or by any State or local government or authority, and including transportation facilities and services which serve the public at large);
 
(D) preservation of an economically sound and competitive petroleum industry; including the priority needs to restore and foster competition in the producing, refining, distribution, marketing, and petrochemical sectors of such industry, and to preserve the competitive viability of independent refiners, small refiners, nonbranded independent marketers, and branded independent marketers;
 
(E) the allocation of suitable types, grades, and quality of crude oil to refineries in the United States to permit such refineries to operate at full capacity;
 
(F) equitable distribution of crude oil, residual fuel oil, and refined petroleum products at equitable prices among all regions and areas of the United States and sectors of the petroleum industry, including independent refiners, small refiners, nonbranded independent marketers, branded independent marketers, and among all users;
 
(G) allocation of residual fuel oil and refined petroleum products in such among all regions and areas of the necessary for the maintenance of exploration for, and production or extraction of, ...

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