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U.S. Supreme Court

United States v. South Buffalo Railway Co., 333 U.S. 771 (1948)

United States v. South Buffalo Railway Co.

No. 198

Argued February 2, 1948

Decided April 26, 1948

333 U.S. 771


1. The commodities clause of the Interstate Commerce Act does not prevent a railroad from transporting commodities of a corporation substantially all of whose stock is owned by a holding company which also owns substantially all of the stock of the railroad, unless the control of the railroad is so exercised as to make it the alter ego of the holding company. United States v. Elgin, J. & E. R. Co., 298 U. S. 492. Pp. 333 U. S. 772-785.

2. In the light of the equitable considerations involved in this case and the fact that Congress rejected as too drastic an amendment proposed for the specific purpose, inter alia, of setting aside the decision of this Court in United States v. Elgin, J. & E. R. Co., supra, this Court declines to overrule that interpretation. Pp. 333 U. S. 773-784.

3. The evidence in this case does not prove that the holding company, in either the legal or economic sense, disregarded the separate entity of its subsidiary railroad or treated it as its alter ego. Pp. 333 U. S. 784-785.

4. Voluntarily abandoned courses of conduct are not grounds for injunction, though they may sometimes be relevant evidence of intent or similar issues. P. 333 U. S. 774.

69 F.Supp. 456 affirmed.

A District Court denied an injunction against alleged violations of the commodities clause of the Interstate Commerce Act, 49 U.S.C. § 1(8). 69 F.Supp. 456. On direct appeal to this Court, affirmed, p. 333 U. S. 785.

Page 333 U. S. 772

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