IN RE: REA Express, Inc., Private Treble Damage Antitrust Litigation

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Case MDL No. 115 Document 2 File PR
= CL Wi og oy ’ ) ) oe“Te BEFORE THE JUDICIAL PANEL... Le SLBATEN 3
Ny . oo ON FEE A . - Co .co MULTIDISTRICT LITIGATION 0502] sn a a. . Co Cerny : - Le LoIN RE REA EXPRESS, INC. » PRIVATE ) ET NG. 2 pay TEEN RE	TREBLE DAMAGE ANTITRUST LITIGATION ) DOCKET 'NO- 1115 iit ;
OPINION AND ORDER
BEFORE ALFRED DP. MURRAH*, CHAIRMAN, AND JOHN MINOR WISDOM, RE =
EDWARD WEINFELD, EDWIN a, ROBSON, WILLIAM H. BECKER, aE h REEJOSEPH gs. LORD, III, AND STANLEY A. WEIGEL, JUDGES OF LL EETHE PANEL a Hee5 4 V)
— NOPER CURIAM owya
REA Express, Inc., an express common carrier, initiateg EET oC
an action in the Eastern District of Pennsylvania against more than EN160 railroads under Sections 1 and 2 of the Sherman Act. Many
of the defendant railroads objected to the venue of the action and Co IB
to service of Process. These objections were resolved by the _ 0
transfer of the action against certain of the defendants to eight oo So oo
Other districts. REA now seeks the transfer of those eight identi- oo
cal antitrust actions to the Eastern District of Pennsylvania oo .
for coordinateq Or consolidated Pretrial Proceedings with the action Co .pending there, bursuant to 28 U.S.C. §1407. EEE
REA also seeks transfer of two additional actions in which i
it is a defendant. rhe first is brought by the st. Louis- iSouthwestern Railway Co. in the Northern District of California, oo
alleging that REA has failed to pay it for transportation of i oo
* Judge Alfred P. Murrah Look no part in the consideration oo	Or decision of this matter.
‘ Co oo

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® express traffic. The second action naming REA as a defendant
is brought by the Seaboard Coast Line Railroad Co. in the
Middle District of Florida, seeking recovery of sums allegedly
due from REA for services rendered. |
The defendant railroads agree on the desirability of ’
transferring all actions, except the Seaboard action, to the
Eastern District of Pennsylvania. We find that all actions,
including the Seaboard action, share extensive common issues
of fact and that their transfer to the Eastern District of
Pennsylvania for coordinated or consolidated pretrial proceedings
will serve the convenience of the parties and witnesses and
further the just and efficient conduct of the litigation.
® In its antitrust actions REA alleges that the defend-
ant railroads, including the St. Louis<Southwestern and the
Seaboard Coast Line, combined and conspired, from 1929 to the
present, to avoid competition in furnishing transportation services
to REA, to impose excessive charges for the use of their facil-
ities and to prevent REA from competing with them or using other
methods of transportation. The alleged conspiracy is said
to have been a misuse of the defendants' monopoly power and
an expansion	of their monopoly into the express business.
One of the central questions common to all the anti-
trust cases is whether the railroads conspired to force REA
to pay more than was required for transportation of trailers .
® on flat cars (piggy back service). REA apparently asserts

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° that, as a common carrier, it was not obligated to pay published
: ICC tariff rates for such service but could negotiate lower rates
: from the railroads. It alleges, however, that in 1967 the defend-
: ants, through their control of REA's stock, forced it to adopt
| a policy of paying ICC tariffs (Plan II 1/2 and Plan IIT tariffs)
for piggyback service from the defendants. The defendants deny
these allegations. The need for coordinated pretrial proceedings
in these antitrust cases is clearly established by these common
issues of fact. |
In the St. Louis-Southwestern case the plaintiff is
seeking recovery for transportation services rendered REA
pursuant to a regional master agreement which REA alleges to be
part of the antitrust conspiracy. St. Louis-Southwestern has
® asserted the same claim as a counterclaim in REA's Pennsylvania
antitrust suit. As the filing of the Pennsylvania counterclaim
indicates, the st. Louis-Southwestern action arises from the same
factual background as the antitrust cases ang should be assigned
to the same judge for pretrial proceedings.
Seaboard, joined by the other railroads, urges that
insufficient common questions of fact are raised by the second
amended complaint in its Florida action to support pretrial
coordination with the remaining actions. 4 It asserts that
1 at the hearing on this matter, Seaboard also urged that transferwould be premature because REA had not yet responded to its
second amended complaint and no accurate evaluation could be
made of the questions of fact common to the Florida and other
actions. Since that time REA has filed an answer to the
® amended complaint and a counterclaim under the antitrust laws.

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i “the Florida action was brought to recover for transportation
® services rendered REA in 1967 and 1968 and that the basis for| this recovery is not the agreements between REA and the railroads
| attacked in the Pennsylvania action but a series of specific
. agreements between Seaboard and REA based on the ICC-approved
tariff rates.
A review of the pleadings in this case leads to the
opposite conclusion and makes clear the need to include it in
coordinated pretrial proceedings. The first amended complaint
of Seaboard in Florida specifically pleaded REA's 1967 policy in
support of its claim for Plan IT 1/2 and III tariffs from REA
for piggyback and related services. The second amended complaint
has eliminated this reference and seeks recovery in three counts.
The first count asserts that Seaboard is entitled to the tariffs
® on the basis of specific contracts formed by correspondence
between REA and Seaboard. The second count asserts that, absent
specific contracts, the ICC's Plan II 1/2 and III rates were
applicable to the piggyback service provided REA; and the third
count seeks recovery of the tariff rates as reasonable value
of these services. ; ‘
. REA's answer denies the existence of the alleged
contracts and the applicability of the Plan II 1/2 and III tariffs.
As an affirmgtive defense it alleges that any contracts were
l/ (cont.)
Seaboard has filed an amended answer to portions of that
counterclaim and several motions: one to strike certain :
affirmative defenses asserted by REA in its answer, one for a
more definite statement of certain counts of the counterclaim
® and one to sever certain counts of the counterclaim for trial.
The filing of these pleadings disposes of the prematurity
argument.

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- the result of the railroads' conspiracy to restrain competition
in dealing with REA and to fix minimum prices for services to
® REA. Seaboard has moved to strike this defense. In its counter-
claim REA makes allegations of conspiratorial conduct to restrain
trade and to expand the railroads' monoply, which are identical
to the allegations in the antitrust actions discussed earlier.
Seaboard denies these allegations in its answer and moves to sever
this aspect of the counterclaim for trial, urging that the Florida
court not exercise jurisdiction and suggesting it would have no
objection to the transfer of the antitrust counterclaims to the
Eastern District of Pennsylvania for pretrial proceedings.
Without expressing any views on the merits oi Seaboard's
motion for severance of REA's antitrust allegations for trial,
we do not think the pretrial development of Seaboard's claims
® against REA may be so neatly disentangled from the pretrial
development of REA's antitrust allegations. The factual back-
ground for both sets of claims is largely common. Although
Seaboard no longer specifically relies on the 1967 tariff policy
challenged in the REA antitrust suits, the transactions in question
apparently occurred during the effective period of the policy
and many of the documents and witnesses relevant to the antitrust
suits will also be relevant to Seaboard's suit. 2 In view of
the likelihood of duplicative discovery the Seaboard action
2/ Seaboard also suggests that transfer is inappropriate because
its discovery is virtually completed, in spite of the recent
filing of its amended complaint. It appears, however, that
REA intends to depose the officials of Seaboard and other
® railroads and the remaining discovery should be coordinated	with that in the other cases.

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® must be transferred for coordinated or consolidated pretrial
proceedings with the other cases.
IT IS THEREFORE ORDERED that all actions on the
attached Schedule A pending in other districts be, and the
same hereby are, transferred to the Eastern District of
Pennsylvania and, with the consent of that court, assigned to
the Honorable Edward Becker for coordinated or consolidated
| pretrial proceedings, pursuant to 28 U.S.C. §1407, with the
actions listed in Schedule A and pending in that district.
oo

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| JUDICIAL PANE,
MULTIBISTRC)heh® BEFORE THE JUDICIAL PANEL FILED ION3 , ON Ferm
MULTIDISTRICT LITIGATION JAN [7 [975
PATRICIA How	Zz J. ARD
CLERK OF Th PANEL
IN RE REA EXPRESS, INC., PRIVATE )
TREBLE DAMAGE ANTITRUST LITIGATION )
)
Chicago, Milwaukee, St. Paul & ) DOCKET NO. 115
Pacific Railroad Co. v. REA )
Express, Inc., N.D. Illinois, )
Civil Action No. 74 C 1093 )
OPINION AND ORDER
BEFORE ALFRED P. MURRAH, CHAIRMAN, AND JOHN MINOR WISDOM,
: EDWARD WEINFELD, EDWIN A. ROBSON, WILLIAM H. BECKER, JOSEPH
S. LORD, III*, AND STANLEY A. WEIGEL*, JUDGES OF THE PANEL
® PER CURIAM
The Panel previously transferred all actions in this
litigation to the Eastern District of Pennsylvania and,
with the consent of that court, assigned them to the
Honorable Edward R. Becker for coordinated or consolidated
1/
pretrial proceedings pursuant to 28 U.S.C. §1407. REA Express,
* Although Judges Weigel and Lord were not present at the
hearing, they have, with the consent of all parties, parti-
cipated in this decision.
l/ In re REA Express, Inc., Private Treble Damage Antitrust
Litigation, 352 F. Supp. 803 (J.P.M.L. 1972),

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Inc. moves the Panel for an order likewise transferring
the above-captioned action to the Eastern District of
Pennsylvania for inclusion in the proceedings pending
there. Plaintiff Chicago, Milwaukee, St. Paul & Pacific
Railroad Company and the bulk of the railroad defendants
in the actions before the transferee court oppose transfer
at this time and suggest that REA's motion be denied without
prejudice to its renewal should the court in the Northern
District of Illinois deny certain motions filed by
| plaintiff.
@ We find that this action involves questions of fact
common to the actions previously transferred to the Eastern
District of Pennsylvania and that its transfer to that
district for coordinated or consolidated pretrial pro-
ceedings will best serve the convenience of parties and
witnesses and promote the just and efficient conduct of
the litigation.
This action was instituted in the Northern District
of Illinois. Plaintiff alleges that REA failed to pay it
for the interstate transportation of 209 empty railroad
freight cars to Green Bay, Wisconsin. This non-payment

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| stems from plaintiff's additional transportation charges to
REA as a result of its recomputation of the tariff rates allegedly
applicable. REA denies liability for the additional charges
contending that it has made payment in accordance with the
individually negotiated rate between it and plaintiff. REA has
also asserted a counterclaim naming plaintiff as a member of
the conspiracy alleged by REA in the actions in the transferee
court. Plaintiff has filed motions in the Northern District
of Illinois seeking dismissal of REA's counterclaim and an order
striking	its affirmative defense. Resolution of those motions
has been stayed by the Illinois court pending the Panel's dis-
position of REA's request for Section 1407 transfer.
e The opponents of transfer concede the existence of common
questions of fact between REA's defense and counterclaim in
the instant action and its claims of conspiracy in the transferee
court. They argue, however, that the requested transfer should
be denied at this time because a favorable ruling on plaintiff's
motions by the court in the Northern District of Illinois
would eliminate that commonality. Moreover, they contend,
the issues raised by plaintiff's motions are independent of
the issues raised in motions before the transferee court and,
hence, transfer prior to a ruling on plaintiff's motions will
not serve judicial economy.
As all parties recognize, common factual questions between
REA's defense and counterclaim in the instant action and its
antitrust claims in the transferee court plainly exist.

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And we are not convinced that the issues raised in the motions
before the court in the Northern District of Illinois are as
readily distinguishable from the issues raised in motions before
the transferee court as the opponents of transfer suggest.
For example, questions relating to the viability of an anti-
| trust defense to suits brought by regulated carriers under ICC
tariffs are before both courts. We perceive little benefit to
be derived from denying REA's motion for transfer without
prejudice pending decision of plaintiff's motions by the court
in the Northern District of Illinois. In view of the fact
that the transferee judge is fully familiar with the factual
( and legal background of all of these disputes, and because
decision on plaintiff's motions has been stayed pending our
ruling, we believe that sound judicial management requires
transfer of the instant action for coordinated or consolidated
pretrial proceedings with the previously transferred litigation.
In the event the transferee court grants plaintiff's motions,
procedures are available whereby its claims may, if appropriate,
be returned to the Northern District of Illinois. 28 U.S.C.
§1407 (a); R.P.J.P.M.L. 15(c), 53 F.R.D. 119, 125 (1971), as
amended 55 F.R.D. LI (1972).
IT IS THEREFORE ORDERED that, pursuant to 28 U.S.C. §1407,
the action, Chicago, Milwaukee, St. Paul & Pacific Railroad
Company v. REA Express, Inc., N.D. Illinois, Civil Action No.
74 C 1093, be, and the same hereby is, transferred to the

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Eastern District of Pennsylvania and, with the consent of
that court, assigned to the Honorable Edward R. Becker for
coordinated or consolidated pretrial proceedings with the
actions pending there.

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| JUDICIAL PANE:
MULTIOISTRIC{| Eh Ol® BEFORE THE JUDICIAL PANEL FILED ION3 , ON Ferm
MULTIDISTRICT LITIGATION JAN [7 [975
PATRICIA How	Zz J. ARD
CLERK oF THE PANE
IN RE REA EXPRESS, INC., PRIVATE )
TREBLE DAMAGE ANTITRUST LITIGATION )
)
Chicago, Milwaukee, St. Paul & ) DOCKET NO. 115
Pacific Railroad Co. v. REA )
Express, Inc., N.D. Illinois, )
Civil Action No. 74 C 1093 )
OPINION AND ORDER
BEFORE ALFRED P. MURRAH, CHAIRMAN, AND JOHN MINOR WISDOM,
: EDWARD WEINFELD, EDWIN A. ROBSON, WILLIAM H. BECKER, JOSEPH
S. LORD, III*, AND STANLEY A. WEIGEL*, JUDGES OF THE PANEL
® PER CURIAM
The Panel previously transferred all actions in this
litigation to the Eastern District of Pennsylvania and,
with the consent of that court, assigned them to the
Honorable Edward R. Becker for coordinated or consolidated
1/
pretrial proceedings pursuant to 28 U.S.C. §1407. REA Express,
* Although Judges Weigel and Lord were not present at the
hearing, they have, with the consent of all parties, parti-
cipated in this decision.
l/ In re REA Express, Inc., Private Treble Damage Antitrust
Litigation, 352 F. Supp. 803 (J.P.M.L. 1972),

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Inc. moves the Panel for an order likewise transferring
the above-captioned action to the Eastern District of
Pennsylvania for inclusion in the proceedings pending
there. Plaintiff Chicago, Milwaukee, St. Paul & Pacific
Railroad Company and the bulk of the railroad defendants
in the actions before the transferee court oppose transfer
at this time and suggest that REA's motion be denied without
prejudice to its renewal should the court in the Northern
District of Illinois deny certain motions filed by
| plaintiff.
@ We find that this action involves questions of fact
common to the actions previously transferred to the Eastern
District of Pennsylvania and that its transfer to that
district for coordinated or consolidated pretrial pro-
ceedings will best serve the convenience of parties and
witnesses and promote the just and efficient conduct of
the litigation.
This action was instituted in the Northern District
of Illinois. Plaintiff alleges that REA failed to pay it
for the interstate transportation of 209 empty railroad
freight cars to Green Bay, Wisconsin. This non-payment

. . Case MDL No. 115 Document 2 Filed 04/30/15 Page 14 of 16
® «3 =
| stems from plaintiff's additional transportation charges to
REA as a result of its recomputation of the tariff rates allegedly
applicable. REA denies liability for the additional charges
contending that it has made payment in accordance with the
individually negotiated rate between it and plaintiff. REA has
also asserted a counterclaim naming plaintiff as a member of
the conspiracy alleged by REA in the actions in the transferee
court. Plaintiff has filed motions in the Northern District
of Illinois seeking dismissal of REA's counterclaim and an order
striking	its affirmative defense. Resolution of those motions
has been stayed by the Illinois court pending the Panel's dis-
position of REA's request for Section 1407 transfer.
e The opponents of transfer concede the existence of common
questions of fact between REA's defense and counterclaim in
the instant action and its claims of conspiracy in the transferee
court. They argue, however, that the requested transfer should
be denied at this time because a favorable ruling on plaintiff's
motions by the court in the Northern District of Illinois
would eliminate that commonality. Moreover, they contend,
the issues raised by plaintiff's motions are independent of
the issues raised in motions before the transferee court and,
hence, transfer prior to a ruling on plaintiff's motions will
not serve judicial economy.
As all parties recognize, common factual questions between
® REA's defense and counterclaim in the instant action and itsantitrust claims in the transferee court plainly exist.

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® A.
And we are not convinced that the issues raised in the motions
before the court in the Northern District of Illinois are as
readily distinguishable from the issues raised in motions before
the transferee court as the opponents of transfer suggest.
For example, questions relating to the viability of an anti-
| trust defense to suits brought by regulated carriers under ICC
tariffs are before both courts. We perceive little benefit to
be derived from denying REA's motion for transfer without
prejudice pending decision of plaintiff's motions by the court
in the Northern District of Illinois. In view of the fact
that the transferee judge is fully familiar with the factual
( and legal background of all of these disputes, and because
decision on plaintiff's motions has been stayed pending our
ruling, we believe that sound judicial management requires
transfer of the instant action for coordinated or consolidated
pretrial proceedings with the previously transferred litigation.
In the event the transferee court grants plaintiff's motions,
procedures are available whereby its claims may, if appropriate,
be returned to the Northern District of Illinois. 28 U.S.C.
§1407 (a); R.P.J.P.M.L. 15(c), 53 F.R.D. 119, 125 (1971), as
amended 55 F.R.D. LI (1972).
IT IS THEREFORE ORDERED that, pursuant to 28 U.S.C. §1407,
the action, Chicago, Milwaukee, St. Paul & Pacific Railroad
Company v. REA Express, Inc., N.D. Illinois, Civil Action No.
@® 74 C 1093, be, and the same hereby is, transferred to the

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Eastern District of Pennsylvania and, with the consent of
that court, assigned to the Honorable Edward R. Becker for
coordinated or consolidated pretrial proceedings with the
actions pending there.
@