William J. Brennan, Jr.

“ Shippers who patronized outside competitors were denied accommodations for future shipments even at full rates of freight, or were discriminated against in the matter of lighterage and other services. Outside competition was also met by dual-rate contracts, by contracts with large shippers at lower rates for volume shipments, and by contracts with American railroads giving conference vessels preference in the handling of cargoes at the docks, and delivering through shipments of freight to conference vessels. ”

“ The Isbrandtsen Co., Inc., filed a petition in the United States Court of Appeals for the District of Columbia Circuit to review, under 5 U.S.C. § 1034, 5 U.S.C.A. § 1034, an order of the Federal Maritime Board [1] approving a rate system proposed by the Japan-Atlantic and Gulf Freight Conference (the Conference) . [2] Under the proposed system a shipper would pay less than regular freight rates for the same service if he signs an exclusive-patronage contract with the Conference. Contract rates would be set at levels 9 1/2 percent below noncontract rates. ”

“ The Act does not forbid shipping conferences in foreign commerce but requires all conference agreements covering the subjects mentioned in § 15 to be submitted for Board approval. [12] No power to fix rates is granted to the Board. Subject to familiar limitations, the power vested in the Board is to approve agreements not found to be unjustly or unfairly discriminatory in violation of §§ 16 and 17 or otherwise in violation of the Act. ”

“ The Committee mentioned advantages such as 'greater regularity and frequency of service, stability and uniformity of rates, economy in the cost of service, better distribution of sailings, maintenance of American and European rates to foreign markets on a parity, and equal treatment of shippers through the elimination of secret arrangements and underhanded methods of discrimination.' Id., at 416. ”

“ At least by 1913 it was recognized that such agreements might run counter to the policy of the anti-trust laws; several cases were pending against foreign and domestic water carriers for alleged violations of the Sherman Act, 15 U.S.C.A. §§ 1-7, 15 note. The House Committee on Merchant Marine and Fisheries of the 62d Congress, of which committee Representative J. W. Alexander was Chairman, undertook an exhaustive inquiry into the practices of shipping conferences. ”

“ Moreover, a breach of the contract subjected the shipper to ordinary damages.
By contrast, the dual-rate contracts here require the carriers to carry the shipper's cargo only 'so far as their regular services are available'; rates are 'subject to reasonable increase' within two calendar months plus the unexpired portion of the month after notice of increase is given; ' (e) ach Member of the Conference is responsible for its own part only in this Agreement'; the agreement is terminable by either party on three months' notice ”