because it is fraught with many dangers and opportunities to commit wrongs by way of harassment and other

Mr. CULPEPPER. Yes, sir; because he already has an avenue. He can go to the Commission with a complaint. He does not need this. This is just a quick, sure, fast way of harrassing nonprofit shipping associations.

Senator LAUSCHE. The members of your association-will you describe to me just how they operate in transporting?

Mr. CULPEPPER. There are basically three kinds of shipping associations. I mean they are organized in three basic ways. One isand there are only about three of these in the United States, like my association, the Atlanta Freight Bureau. We are not a shipping association as you think about them, because we were organized back in 1902 and we offer a full traffic manager service to our members at cost. But our members came to us back in 1950 and asked us, pled with us, begged us to begin to supervise a consolidated freight car out of New York and Chicago into Atlanta, and we save them 20 to 30 percent by supervising that operation. Now we do not make a penny out of it. They save 20 to 30 percent, and they pay use exactly the all-commodity rate plus the cost of consolidating, delivering, and all that. They pay us that. That is one type of operation.

Another is chamber of commerce or a retail credit association, the members of it might get somebody, a general manager or one of their members or the traffic manager of one of their members to organize an association whereby the members of the retail credit association or the chamber of commerce might pool their cars.

Then there is another where a group of stores will get together, a group of retail stores will get together and they will form an association and pool their cars.

Now, then, there is a third type which I claim is perfectly legitimate until they overstep the boundary and make a profitmaking proposition whereby some manager, maybe some traffic manager of some concern, sees the need for it and he goes out and talks to some of the dealers or distributors in the town and they get together and form one.

Now those are basically the four types of associations that I claim. are entirely within the scope of the exemption provided by section 402 (c).

Now the idea, the excuse that these folks have is that somebody goes out and organizes one and makes them a fat job or doesn't give the members the full benefit of the savings on it. That is what the freight forwarders claim and what the truckers claim, and therefore that they are really operating as a freight forwarder without having a permit. Now that is what they claim, see? But the Commission still has a way to find that out, Mr. Chairman.

Senator LAUSCHE. Well, your position is that there is no need for the giving of the right to sue to a private individual to carry into effect regulatory provisions and practically criminal provisions in some instances inasmuch as that power is now existent in the Com

mission?

Mr. CULPEPPER. That is right.

Senator LAUSCHE. And you feel that that is where it ought to remain?

Mr. CULPEPPER. I feel that is where it ought to remain.

Senator LAUSCHE. That it is a hazard to give to a person who feels that he is injured the right to bring a private suit when you have laws in the statute books giving a Federal agency the power to carry into effect what the private individual feels ought to be done?

Mr. CULPEPPER. You are so right, Mr. Chairman.

Mr. KENNEY. Let me ask you, the Atlanta Freight Bureau does not operate in clear and patent violation of section 410 of the Interstate Commerce Act?

Mr. CULPEPPER. Are you asking me that it doesn't?

Mr. KENNEY. It does not?

Mr. CULPEPPER. It certainly does not, sir.

Mr. KENNEY. Nor do any of the other members of the nonprofit association?

Mr. CULPEPPER. So far as I know, any other members of the national conference do not. However, that would not keep a man from Atlanta day after tomorrow, if this bill were enacted into law, from going to a Federal court down there and accusing the Atlanta Freight Bureau of operating in clear and patent violation.

Mr. KENNEY. Obviously, but he can go to the Commission today and make that accusation?

Mr. CULPEPPER. Today he has got to go to the Commission, and the Commission weighs the thing, and they don't come out and say, “You stop operating," until they have had an investigation. The court can say, "You stop operating tomorrow," just because somebody says that we are in clear and patent violation.

Senator LAUSCHE. All right, thanks very much, Mr. Culpepper. Mr. CULPEPPER. Oh, I am indebted to you, Mr. Chairman. You are always so gracious and kind, and I appreciate it.

Senator LAUSCHE. You are welcome.

(Prepared statement of Mr. Culpepper appears in the appendix.) Senator LAUSCHE. Mr. Noel Clark, president of the National Association of Railroad & Utilities Commissioners.

STATEMENT OF NOEL A. CLARK, PRESIDENT, NATIONAL ASSOCIA

TION OF RAILROAD & UTILITIES COMMISSIONERS

Mr. CLARK. My name is Noel A. Clark, I am a member of the Nevada Public Service Commission, Carson City, Nev., and am serving this year as president of the National Association of Railroad & Utilities Commissioners.

The National Association of Railroad & Utilities Commissioners is a voluntary organization embracing within its membership the members of the regulatory commissions and boards of the several States of the United States. These are the State agencies charged with the responsibility of regulating the motor carriers operating within their respective jurisdictions.

The association has been concerned for some time with the problem of motor carrier enforcement, particularly as it relates to unlawful for-hire trucking operations.

When this subject matter first received legislative attention in the 87th Congress, the association formed an ad hoc committee to work with the Interstate Commerce Commission and representatives of the transportation industry to develop mutually satisfactory legislation,

which would aid motor carrier enforcement without encroaching on the historic function of the State agencies.

The Honorable Walter R. McDonald, of the Georgia Public Service Commission, is chairman of this ad hoc committee and is forwarding a statement to your subcommittee in support of H.R. 5401.

I have been a member of this ad hoc committee since its creation and am appearing this morning to personally testify to the support of the association to section 1 of this bill authorizing cooperative agreements between the various States and the Interstate Commerce Commission, section 2 of this bill relating to State registration of Interstate Commerce Commission operating authority, and to sections 6 and 7 which would permit shippers to obtain reparations against motor carriers and freight forwarders for overcharges on past ship

ments.

The language of section 2, relating to the State registration of Interstate Commerce Commission certificates, was worked out through the mutual efforts of our ad hoc committee, the Interstate Commerce Commission, and the principally affected carriers.

In this regard, the association has concurred in the House committee amendment inserted in section 2, which would provide for standards so as to permit the filing of evidence of self-insurance. This amendment is not present in S. 1727.

All of these proposals have very worthwhile objectives and are in the public interest. They will facilitate efforts to control the serious problem of unlawful truck operations. In the case of reparations they will do equity for shippers who are presently without recourse to obtain redress for past overcharges by motor carriers or freight forwarders.

We strongly urge that your subcommittee favorably endorse H.R.

5401.

Thank you, Mr. Chairman.

Senator LAUSCHE. Does H.R. 5401 meet with your approval or disapproval or part approval and part disapproval?

Mr. CLARK. It meets with our approval.

Senator LAUSCHE. Full approval?

Mr. CLARK. We concur with the bill.

Senator LAUSCHE. And this right to self-insurance you feel should be written into S. 1727?

Mr. CLARK. It poses no problem and in many instances it is actually in practice.

Senator LAUSCHE. Is your association appearing before the subcommittee of the Commerce Committee on the Federal Power Commission bill?

Mr. CLARK. Yes, sir.

Senator LAUSCHE. What position have they taken?

Mr. CLARK. The number of the bill, sir?

Mr. SENDER. S. 218.

Mr. CLARK. We support the bill.

Senator LAUSCHE. You support the bill?

Mr. CLARK. Yes, sir.

Senator LAUSCHE. Thanks very much.

Mr. CLARK. Thank you.

Senator LAUSCHE. Mr. Charles A. Washer, executive assistant,

American Retail Federation.

You may proceed. Your whole statement will be placed in the record, and you can proceed as you wish. You can either read it all or you can give the highlights of it.

STATEMENT OF CHARLES A. WASHER, EXECUTIVE ASSISTANT, AMERICAN RETAIL FEDERATION

Mr. WASHER. Fine. Thank you, sir. I did want to read a few of the paragraphs to begin with.

The American Retail Federation is comprised of some 45 statewide and 31 national associations of retailers, and we represent the views. of retailers throughout the country, all types and sizes.

I think, as mentioned by Mr. Culpepper, retailers have a sincere and economic interest in shipping associations throughout the country. I think, if anything, it is emphasized the farther you go west from the source of highly valued and highly rated merchandise, the more intense their interest becomes.

They are also users of all types of transportation, including forwarders and motor carriers. So we are also interested in the reparations feature of the bill. So our statement is on these two subjects. First of all, we are opposed to the injunctive procedure as applied to part IV of the act, or so-called violations of part IV. I do not know what the position of the Commission has been to date. We do know that back when your subcommittee was considering S. 2560 the Commission was opposed; and on page 2 I quote the hearings from S. 2560, in which the Commission stated that the problems relating to shipper associations in violation of part IV were extremely complex, and that therefore any such provision for injunctive relief would not aid them in their enforcement problem.

The provision was added to S. 2560, and the Freight Forwarders Institute at that time said that they hoped the Commission would come out with some definite guidelines which could be used in an injunctive procedure under a clear and patent violation.

But as I point out, the Commission did have a landmark decision in the Atlanta Shippers Association, and let me first point out that that is not to be confused with Mr. Culpepper's operation. That is entirely separate. But this decision in 1964, the Commission-and I quote on page 3, that

Whether any particular transportation function is. in substance, a forwarding service, the unauthorized sale of which is prohibited by the statute, can be determined only after careful and complete analysis of all the facts and circumstances surrounding the performance of such transportation.

In that particular case it may sound as though they were going to find that this was a lawful operation. They did not. They found that it was a violation of section 410, and that this was an unlawful freight forwarder operation. I think that is significant because the Congress has already provided in section

Senator LAUSCHE. A little louder, please.

Mr. WASHER. I am sorry. The Congress has already provided in section 417(b) a provision for injunctive relief against violation by freight forwarders.

Senator LAUSCHE. Being filed by whom?

Mr. WASHER. They have restricted that so that any procedure must be filed by the Commission, the Attorney General, or if it is a violation of a Commission order, by any injured party.

But you see, they made it very restrictive, and I think Congress was very forethoughtful in adding that provision.

Senator LAUSCHE. That is section 417 (b) allows the bringing of an action to restrain further wrongs but limits the right to bring the action to the Attorney General, the Commission, and in case of an order having been issued and disobeyed, then by one of the interested parties?

Mr. WASHER. That is correct.

Senator LAUSCHE. And you feel that that is adequate and does serve justice in treating the transporters in our country?

Mr. WASHER. I feel that this is a proper provision in that even in the case of a freight forwarder who is violating part 4, an injured party must still go before the Commission first and obtain his order before he brings to the courts; and I think, as was mentioned by the farm people, here is a case of clear discrimination. If it is a person who is not even within the scope of part IV, you allow him to go to the court immediately, but if he is a violating or an unlawful forwarder you make him go to the Commission first and then to the court.

The issue is still a complex one. We believe that the proper procedure is for a Commission determination.

On page 4 I do mention some of the background of H.R. 5401. We did not appear in H.R. 5401 before the House solely on the reparations portion because it did not include any part IV section, and although some individual have a feeling that the application of the injunctive process against part II and part IV both should be stricken, we do not object or have any statement as to injunctive relief for part II violation.

Senator LAUSCHE. And part II violations are what?
Mr. WASHER. Motor carriers.

On page 5 I try to point out, and I do not know whether it has been mentioned yet, that whether this shipping association is a lawful one, an unlawful one, a flagrant violation, or what, it still transports its merchandise by the common carriers of this country. If it does not, relief can be obtained under part II for violation of motor carriers, or if it is conducting any waterway or rail operation which is unlawful you have relief under those parts. But as a shipping association, just as a forwarder, there is no traffic being diverted from the common carriers of this country. So that the situation may be different from a practical economic standpoint from the violations of part II. Now our concluding section is on the provisions of reparations, and we do favor, and have for many years, the establishment of reparations for part II and part IV motor carriers and freight forwarders.

There was a recent case before the Commission in which the motor carriers had published a surcharge. The period of suspension expired, the surcharge was applied for-I think it was some 6 to 9 months before the final Commission decision found that that was unlawful. There is no way for shipers to recover those excess charges.

We prefer the provisions of S. 1732 which permit a Commission award of reparations. We do not object to the other provision in S. 1727 which allows it only upon court application. In either case,