NMFTA, NCC to appeal STB’s decision to revoke antitrust immunity

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The National Motor Freight Traffic Association said Monday, July 9, that it will challenge the Surface Transportation Board’s decision that — if allowed to stand — would eliminate the antitrust immunity protecting the National Classification Committee’s classification-making activities effective Jan. 1, 2008. NMFTA and NCC filed their appeal with the U.S. Court of Appeals for the D.C. Circuit on Monday, July 2.

Since 1996, STB — the successor to the Interstate Commerce Commission — has been the administrative agency responsible for oversight of NCC’s collective classification making activities. STB on May 7 issued a decision regarding motor carrier bureaus that would, among other things, eliminate antitrust immunity for NCC’s classification-making activities, effective Sept. 4.

“We believe this decision is flawed and clearly contrary to the intent of Congress, and it has a very good chance of being overturned,” says Bill Pugh, NCC secretary and NMFTA executive director. NCC is an autonomous body of NMFTA, which provides shippers and carriers a standard on which to base pricing negotiations.

In late May, NMFTA and NCC indicated that the 120-day interval between the service and effective dates of STB’s decision was not adequate for the substantial modifications to the structure of NCC and the development of revised classification-making procedures that have to be approved by NMFTA’s membership, as well as the process of preparing a successful application for a business review letter from the U.S. Department of Justice. At that time, NMFTA requested an implementation date of 18 months from the issuance of STB’s ruling.

The request for modification of the ruling indicated that NMFTA’s member carriers and their shipper customers depend on NMFC not only for the classes and commodity descriptions, but also the rules, packaging specifications, bills of lading, and listing of carriers. The adjustments that accompany their adaptation to a new classification system could entail having carriers modify systems that have been in place for many years and retraining personnel; similarly, shipper customers of all 1,100-plus NMFTA members would require a reasonable amount of time in order to adjust a core component of their existing systems.

“We are appealing the STB’s attempt to remove the NCC’s antitrust immunity because this immunity enables the NCC the flexibility to provide many services that are in the interests of its members, and the transportation community,” Pugh says. “If the NCC’s antitrust immunity is terminated, we will, of course, make the modifications in our procedures as necessary to operate without immunity. In any event, the classification-making process will continue because over many years the NMFC has proven to work well for carriers, shippers and all concerned.”