United States Court of Appeals
FOR THE DISTRICT OF COLUMBIA CIRCUIT
Argued April 14, 1998 Decided June 12, 1998
No. 97-1346
Caribbean Shippers Association, Inc.,
Petitioner
v.
Surface Transportation Board and
United States of America,
Respondents
NPR, Inc. and
TAG/ICIB, Inc.,
Intervenors
On Petition for Review of an Order of the
Surface Transportation Board
Rick A. Rude argued the cause and filed the briefs for
petitioner.
Craig M. Keats, Associate General Counsel, Surface Trans-
portation Board, argued the cause for respondents, with
whom Joel I. Klein, Assistant Attorney General, United
States Department of Justice, Robert B. Nicholson and Rob-
ert J. Wiggers, Attorneys, and Henri F. Rush, General Coun-
sel, Surface Transportation Board, were on the brief.
Dennis N. Barnes and John J. Mullenholz were on the
joint brief for intervenors NPR, Inc. and TAG/ICIB, Inc.
Before: Silberman, Henderson, and Rogers, Circuit
Judges.
Opinion for the Court filed by Circuit Judge Silberman.
Silberman, Circuit Judge: Caribbean Shippers Association,
Inc. petitions for review of a Surface Transportation Board
order dismissing its complaint against NPR, Inc. and TAG/
ICIB, Inc. (TAG). Caribbean alleges that NPR and TAG
violated the statutory provision which prohibits federally reg-
ulated water carriers or their agents from disclosing confiden-
tial commercial information regarding shippers' goods to com-
petitors. We deny the petition.
I.
Caribbean Shippers Association's members are non-vessel
operating common carriers that ship containerized freight
between the continental United States and Puerto Rico.
These "carriers" are similar to surface freight forwarders;
they aggregate small shipments at origin, buy space on a
vessel, and provide distribution services at destination. NPR
and two other vessel operating carriers--Sea-Land Service,
Inc. and Crowley American Transport, Inc.--control approxi-
mately 90% of the market in the United States/Puerto Rico
route. All three utilize TAG, a private policing organization
which inspects cargo, to ensure tariff compliance. TAG ob-
tains from the carriers the information that customers furnish
along with their cargo. It may open and examine the con-
tents of shipments to verify the accuracy of that information
and thus assure that customers like Caribbean's members are
adhering to the carriers' tariffs, which are on file with the
STB.
In 1996, Caribbean complained to the Board that NPR and
TAG had disclosed shipment and routing information to its
members' competitors and to other water carriers in violation
of 49 U.S.C. s 14908(a)(1), which provides:
A [water carrier or broker subject to regulation by the
Surface Transportation Board] or an officer, receiver,
trustee, lessee, or employee of that carrier or broker, or
another person authorized by that carrier or broker to
receive information from that carrier or broker may not
disclose to another person, except the shipper or consign-
ee, ... information about the nature, kind, quantity,
destination, consignee, or routing of property tendered or
delivered to that carrier or broker for transportation ...
without the consent of the shipper or consignee if that
information may be used to the detriment of the shipper
or consignee or may disclose improperly to a competitor
the business transactions of the shipper or consignee.
(Emphasis added.) Although Caribbean initially contended
that TAG directly disclosed information gained in the process
of conducting inspections for carriers, its later theory was
that NPR's disclosure of confidential information to TAG was
tantamount to disclosure to Sea-Land and Crowley, the other
carriers for which TAG performs inspections. According to
petitioner, because TAG policed for the three different carri-
ers, it impermissibly served as an "informational clearing-
house" with "a vast archive of confidential commercial infor-
mation," which it used for the benefit of its clients. It asked
the Board to issue a cease and desist order and to further
require TAG to return all of the records it had obtained from
NPR to the carrier's customers. The Board characterized
Caribbean's argument in the following manner:
when it is working for Crowley, TAG may pay particular
attention to a shipper that it knows, as a result of its
work for NPR or Sea-Land, has a history of misdescrib-
ing shipments. It is this ability to use information it
has obtained while working for one [carrier] in the
course of inspections for another [carrier] that [Caribbe-
an] characterizes as an unlawful disclosure of informa-
tion.
Caribbean Shippers Ass'n, Inc., No. WCC-100 (Mar. 18,
1997) (emphasis added). Caribbean never made quite clear to
the Board why the arrangement between the three water
carriers and TAG caused it "detriment"--or harm of any sort.
The only harm it identified was its assertion that the carriers
used TAG to purposefully delay their members' shipments--
and thereby induce their customers to ship directly with the
water carriers. But it did not explain why TAG would be
better able to delay shipments because it inspected for all
three carriers.
The Board dismissed Caribbean's complaint as not stating
"reasonable grounds for investigation and action." 49 U.S.C.
s 14701(b) (1994). The Board reasoned that the statute was
aimed at "actual disclosures of information" not the transfer
of information among TAG employees concerning lessons
learned about the practices of certain shippers. And even if
TAG's operations constituted a disclosure within the meaning
of s 14908(a)(1), it was not a prohibited disclosure. TAG
should be encouraged to use the experience it gained in
working for all three carriers to prevent fraud.
II.
Petitioner challenges the Board's statutory interpretation,
suggesting that s 14908(a)(1)'s "disclosure" has a plain mean-
ing that includes TAG's internal use of information acquired
from inspecting for one carrier in conducting inspections for
another carrier. We disagree. The Random House College
Dictionary (Revised Ed. 1980) 378 defines "disclose" to mean:
"1. to make known; reveal or uncover. 2. to cause to appear;
lay open to view." Under this definition, it does not seem
that TAG discloses a shipper's confidential information to
anyone. TAG does not "reveal" or "make known" any infor-
mation it receives from one carrier to other carriers; indeed,
its contracts with its clients explicitly prohibit TAG from
doing so. And it certainly does not lay such information open
to public view. We think the statute's term "disclosure" is at
least ambiguous as applied to this situation and therefore
under Chevron we must defer to the Board's construction if it
is a permissible one. Chevron U.S.A. Inc. v. Natural Re-
sources Defense Council, Inc., 467 U.S. 837 (1984).
That the Board's interpretation of "disclosure" is permissi-
ble we have no doubt. Caribbean contends that s 14908(a)(1)
should be read in tandem with s 14908(b)(3) (1994), a statuto-
ry exemption allowing a carrier to give information "to anoth-
er carrier or its agent to adjust mutual traffic accounts in the
ordinary course of business." Petitioner asserts that
s 14908(b)(3) is the only circumstance under which a carrier
is permitted to disclose confidential shipper information to
another carrier. But that argument, a tenuous use of the
expressio unius canon, see Shook v. District of Columbia Fin.
Responsibility and Management Assistance Auth., 132 F.3d
775, 783 n.5 (D.C. Cir. 1998), assumes that TAG does "dis-
close" information--which is the very issue in this case.
It is impossible to imagine any reason why TAG's operation
can be thought to offend the obvious policy grounds that
underlie s 14908(a)(1)--the provision is clearly designed to
prevent the disclosure of useful competetive information to
other shippers.1 Certainly petitioner is not entitled to seek
less vigilant enforcement of tariff compliance activities. The
statute governing STB-regulated water carriers expressly
requires that carriers file their rates in tariffs, and that they
collect only the filed tariff rate. 49 U.S.C. s 13702 (1994).
The Board believes TAG performs a valuable service by
helping carriers comply with this "filed rate doctrine." Cf.
Maislin Indus., U.S., Inc. v. Primary Steel, Inc., 497 U.S.
116, 132 (1990) (explaining that under the Interstate Com-
merce Act, collection of filed rates is "utterly central" to
administration of the statute). Were the STB to adopt
__________
1 Petitioner claims that as true freight forwarders its members
actually compete with the carriers. Even though that is true in
some sense, petitioner never shows why TAG's practice causes
Caribbean's interpretation of the statute, a company such as
TAG would no longer be as effective at preventing fraud. It
would either have to limit its inspection activities to one
carrier--an option under which it probably could not stay in
business--or set up Chinese walls between units inspecting
for different carriers. Under either scenario, the outcome
would be less effective tariff enforcement and presumably
more undetected violations of the law.2
At oral argument, we gained the impression that petition-
er's real concern is that so long as TAG performs the
inspection service for all three carriers it is more difficult for
petitioner to play one against the other. If a shipper is
unhappy about the manner in which TAG categorizes its
merchandise, for example, it is hard for that shipper to gain
more favorable treatment elsewhere because each of the
major carriers in the market uses TAG. But competition in
inspection efficiency, or more accurately inefficiency, is hardly
the sort of competition the statute is designed to protect.3
Carribean also complains that it was denied its statutory
procedural rights because the STB dismissed its complaint
without allowing discovery. But 49 U.S.C. s 14701(b) allows
the Board to "dismiss a complaint that it determines does not
state reasonable grounds for investigation and action." Here,
the Board thought that the issue raised by Caribbean was
essentially a legal one and saw "no basis for going through
discovery and protracted proceedings in order to permit
__________
competitive injury and, in any event, the Commission reasonably
interpreted the section to protect only against disclosure to shipper
competitors.
2 For similar reasons, even if petitioner's interpretation of
disclosure were accepted, it would still face an insurmountable
difficulty in challenging the Board's conclusion that it did not suffer
a "detriment" or that the disclosure was improper.
3 Indeed, if that is petitioner's injury, it is doubtful that it would
have prudential standing; and it seems that it runs afoul of the
court's chutzpah doctrine. See Marks v. Commissioner, 947 F.2d
983, 986 (D.C. Cir. 1991) (fugitives from criminal prosecution argued
that inadequate efforts were made to notify them of tax delinquen-
cy); Harbor Ins. Co. v. Schnabel Found. Co., 946 F.2d 930, 937 &
n.5 (D.C. Cir. 1991) (subcontractor asserted contractor was negli-
gent for relying on subcontractor's advice).
[Caribbean] to pursue legal claims that will ultimately prove
fruitless." As we have previously stated, "the conduct and
extent of discovery in agency proceedings is a matter ordi-
narily entrusted to the expert agency in the first instance and
will not, barring the most extraordinary circumstances, war-
rant the Draconian sanction of overturning a reasoned agency
decision." Trailways Lines, Inc. v. ICC, 766 F.2d 1537, 1546
(D.C. Cir. 1985). In this case, there is little dispute as to how
TAG uses the information it receives from carriers; Caribbe-
an here objects to the manner in which TAG readily acknowl-
edges it uses the information. While discovery into TAG's
operations might be useful to Caribbean's members for other
reasons, we agree with the Board that discovery for the
purpose of resolving petitioner's complaint would have not
been worthwhile. See id. (discovery not required when seen
by an agency as unlikely to affect its decision).
* * * *
Accordingly, Caribbean's petition for review is denied.
So ordered.