United States v. Scrap, 412 U.S. 669 (1973)

United States v. Students Challenging

Regulatory Agency Procedures (SCRAP)
No. 72-535

Argued February 28, 1973
Decided June 18, 1973 *
412 U.S. 669

APPEAL FROM THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF COLUMBIA

Syllabus

The Interstate Commerce Act permits railroads to file proposed freight rate increases, with at least 30 days’ notice to the Interstate Commerce Commission (ICC) and the public before putting the new rates into effect. The ICC may, pursuant to § 15(7) of the Act, suspend the operation of the proposed rates for as long as seven months, in order to investigate the lawfulness of the rates. At the end of the seven-month period, the carrier may put the suspended rates into effect unless the ICC has completed its investigation and found the rates unlawful. Proceeding under the statutory scheme, substantially all the Nation’s railroads sought a 2.5% surcharge on nearly all freight rates, as an emergency measure to obtain increased revenues pending adoption of selective rate increases on a permanent basis. Shippers, competing carriers, and other interested persons requested the ICC to suspend the tariff for the statutory seven-month period. Various environmental groups, including Students Challenging Regulatory Agency Procedures (SCRAP) and the Environmental Defense Fund, appellees here, protested that failure to suspend the surcharge would cause their members "economic, recreational and aesthetic harm," and specifically, that the new rate structure would discourage the use of "recyclable" materials and promote the use of raw materials that compete with scrap, thus adversely affecting the environment. On February 1, 1972, the ICC issued an order announcing its decision not to suspend the surcharge for the seven-month period, and on April 24, 1972, ordered the proposed selective increases filed by the carriers to be suspended for the full seven-month period ending November 30, 1972, and permitted the collection of the surcharge until that date. SCRAP filed the present suit seeking, inter alia, an injunction to restrain enforcement of the February 1 and April 24 orders allowing the carriers to collect the surcharge. SCRAP, an unincorporated association formed by five law students to enhance the quality of the environment, claimed that its members

suffered economic, recreational and aesthetic harm directly as a result of the adverse environmental impact of the railroad freight structure,

that each of its members was caused to pay more for finished products, that each of its members uses the forests, rivers, mountains, and other natural resources of the Washington, D.C., area, and at his legal residence for camping, hiking, fishing, and other purposes, and that these uses have been adversely affected by increased freight rates. The main thrust of SCRAP’s complaint was that the ICC’s orders were unlawful for failure to include a detailed environmental impact statement as required by § 102(2)(C) of the National Environmental Policy Act of 1969 (NEPA), 42 U.S.C. § 4332(2)(C). The three-judge District Court found that appellees had standing to sue. The court held that its power to grant an injunction was not barred by Arrow Transportation Co. v. Southern R. Co., 372 U.S. 658, because NEPA

implicitly confers authority on the federal courts to enjoin any federal action taken in violation of NEPA’s procedural requirements . . . so long as the review is confined to a determination as to whether the procedural requisites of NEPA have been followed.

The court concluded that the ICC’s decision not to suspend the surcharge for the seven-month period was a "major federal action significantly affecting the quality of the human environment," and granted an injunction prohibiting the ICC "from permitting" and the railroads "from collecting" the surcharge "insofar as that surcharge relates to goods being transported for purposes of recycling."

Held:

1. Appellees’ pleadings sufficiently alleged that they were "adversely affected" or "aggrieved" within the meaning of § 10 of the Administrative Procedure Act to withstand a motion to dismiss on the ground of lack of standing to sue. Sierra Club v. Morton, 405 U.S. 727, distinguished. Pp. 683-690.

(a) Standing is not confined to those who show economic harm, as "[a]esthetic and environmental wellbeing, like economic wellbeing, are important ingredients of the quality of life in our society." Sierra Club, supra, at 734. P. 686.

(b) Here, the appellees claimed that the specific and allegedly illegal action of the ICC would directly harm them in their use of the natural resources of the Washington area. Pp. 686-687.

(c) Standing is not to be denied because many people suffer the same injury. Pp. 687-688.

(d) It cannot be said on these pleadings that appellees could not prove their allegations, which, if proved, would place them squarely among those persons injured in fact, by the ICC’s action and entitled to review under Sierra Club, supra. Pp. 688-690.

2. The District Court lacked jurisdiction to issue the injunction. Pp. 690-698.

(a) Arrow Transportation, supra, held that Congress, in § 15(7), had vested exclusive jurisdiction in the ICC to suspend rates pending its final decision on their lawfulness, and had deliberately extinguished judicial power to grant such relief; and the factual distinctions between the instant case and Arrow Transportation are inconsequential. Pp. 690-692.

(b) The alleged noncompliance by the ICC with NEPA did not give the District Court authority to grant the injunction, as NEPA was not intended to repeal by implication any other statute, and the policies identified in Arrow Transportation as the basis for § 15(7) would be substantially undermined if the courts were found to have suspension powers simply because of noncompliance with NEPA. Pp. 692-698.

346 F.Supp. 189, reversed and remanded.

STEWART, J., delivered the opinion of the Court, in which BRENNAN and BLACKMUN, JJ., joined; in Parts I and II of which DOUGLAS and MARSHALL, JJ., joined; and in Parts I and III of which BURGER, C.J., and WHITE and REHNQUIST, JJ., joined. BLACKMUN, J., filed a concurring opinion, in which BRENNAN, J., joined, post, p. 699. DOUGLAS, J., filed an opinion dissenting in part, post, p. 699. WHITE, J., filed an opinion dissenting in part, in which BURGER, C.J., and REHNQUIST, J., joined, post, p. 722 MARSHALL, J., filed an opinion concurring in part and dissenting in part, post, p. 724. POWELL, J., took no part in the consideration or decision of the cases.