HARRIMAN v. INTERSTATE COMMERCE COMMISSION; KAHN v. INTERSTATE COMMERCE COMMISSION; INTERSTATE COMMERCE COMMISSION v. HARRIMAN, 211 U.S. 407

Mr. Justice Holmes delivered the opinion of the court. These are appeals; on the one side, from an order of the Circuit Court directing the appellants, Harriman and Kahn, to answer certain questions put during an investigation by the Interstate Commerce Commission, and, on the other, from a denial of a like order as to two other questions, answers to which the commission had required.

In November, 1906, the Interstate Commerce Commission, of its own motion, and not upon complaint, made an order reciting the authority and requirements of the act to regulate commerce (Feb. 4, 1887, c. 104, 24 Stat. 379), and proceeding as follows: “And whereas it appears to the Commission that consolidations and combinations of carriers subject to the act, arid the relations now and heretofore existing between such carriers, including community of interests therein, and the practises arid methods of such carriers affecting the movement of interstate commerce, the rates received and facilities furnished therefor should be made the subject of investigation by the Commission to the end that it may be fully informed in respect thereof, and to the further end that it ¡nay be ascertained whether such consolidations, combinations, relations, community of interests, practises, or methods result in violations of said act or tend to defeat its purposes; It is ordered that a proceeding of investigation and inquiry into and concerning the matters above stated be, and the same is hereby instituted.” A time and place was set for the first hearing, and the inquiry thus begun was continued for about two months, resulting in the report of July, 1907, entitled “Consolidations and Combinations of Carriers,” etc. 12 I.

C. C. R. 277. In the course of the inquiry the appellant Harriman was called by the commission and testified as a witness. At the time of the transactions referred to he was a director and also the president and the chairman of the Executive Committee of the Union Pacific Railroad Company. The relations between the Union Pacific and other connecting roads, parallel or not, were under investigation and are set forth in the commission’s report.

It is enough to say that the Union Pacific Railroad Company is incorporated under the laws of Utah, and, as has been asserted and assumed, has power under the state laws to purchase the stock of other railroads, a power that it has exercised on a large scale. Among other things, it bought 103,401 shares of the preferred stock of the Chicago and Alton Railway Company. These shares had been deposited with bankers, Kuhn, Loeb & Company, by their owners, under an agreement authorizing the bankers to sell them to any purchaser at such price and upon such terms as should be approved by Messrs.

Stewart, Mitchell and the witness, Harriman. He was asked whether he owned any of the stock so deposited, and how much, if any. These questions, under the advice of counsel, he declined to answer. Next he was asked with regard to stock of the Atchison, Topeka & Santa Fé Railroad Company, bought by the Oregon Short Line Railroad Company, another Utah corporation, the stock of which was owned by the Union Pacific, whether it was part of the stock that had been acquired previously by him and two others, and whether it or any part of it was owned by any of the three.

After answering the first question, “I think not,” he was stopped by his counsel and refused to answer further. Again, it appearing that the Union Pacific, in July, 1906, purchased 90,000 shares of Illinois Central Railroad stock from Messrs. Rogers, Stillman and the witness, he was asked whether that stock was acquired by a pool of the three, whether it was acquired with a view of selling it to the Union Pacific, and whether it or any part of it was bought at a much lower price than $175 a share with the intent just mentioned. These questions the witness declined to answer.

It appearing further that Kuhn, Loeb & Company, who were the fiscal agents of the Union Pacific, had sold to it 105,000 shares of the Illinois Central stock on the same date, he was asked if he had any interest in these shares, and whether they were acquired by a pool for the purpose of selling them to the Union Pacific. These questions the witness declined to answer. Again, it appearing that the Union Pacific had purchased stock of the St.

Joseph and Grand Island Railroad Company from the witness since the last-mentioned date, he was asked when he acquired the stock and what he paid for it, and again de-dined to answer. Finally, after it had been shown that since-July, 1906, the Union Pacific had bought a large amount of New York Central Railroad stock, the witness was asked whether any of the directors of the Union Pacific were interested directly or indirectly in this stock at the time when it was sold. An answer to this question also was declined. All these refusals to answer were persisted in after a direction to answer from the commission.

The Circuit Court ordered them to be answered and Harriman appealed. The petition of the Interstate Commerce Commission set forth two other questions which the witness refused to answer, and on which it asked the order of the Circuit Court.

One was a general one, whether he was interested in any stocks bought between the nineteenth of July and the seventeenth of August that appreciated, and another, more specific, was whether he or any director bought any Union and [or] Southern Pacific in anticipation of a certain- dividend, the suggestion- being that announcement of the dividend was delayed for the directors to profit by their secret knowledge and that they did so. With regard to these the petition was denied, and the Interstate Commerce Commission appealed. ’ The appellant Kahn was a member of the firm of Kuhn, Loeb & Company.

He also was asked whether any of the directors of the Union Pacific were the real owners of any of the shares of the Chicago and Alton Railroad deposited, as has been stated, with Kuhn, Loeb & Company, and sold to the Union Pacific. He was asked further in various forms whether the before mentioned 105,000 shares of Illinois Central stock, or any part of them, really belonged to or were held for any of the directors of the Union Pacific. And again, whether at the same time that he bought these shares he bought for Messrs. Harriman,. Rogers and Stillman the stocks they sold at the same -time that he sold his.

Finally he was asked whether the 105,000 shares, and the 90,000 shares turned in by Stillman, Rogers and Harriman, were all bought through his instrumentality for a pool of which they and he were members, that was operating in Illinois Central stocks for some months before July, 1906. All these questions he was directed by the' commission to answer, but refused. The Circuit Court ordered him to answer, and he appealed. Many broad questions were discussed in the argument before us, but we shall confine ourselves to comparatively narrow ground.

The contention of the commission is that it may make any investigation that it deems proper, not merely to discover any facts tending to defeat the purposes of the act of February 4, 1887, but to aid it in recommending any additional legislation relating to the regulation of commerce that it may conceive to be within the power of Congress to enact; and that in such an investigation it has power, with the aid of the courts, to require any witness to answer any question that may have a bearing upon any part of what it has in mind.

The contention necessarily takes this extreme form, because this was a general inquiry started by the commission of its own motion, not an investigation upon complaint, or of some specific matter that might be made the object of a complaint. To answer this claim it will be sufficient to construe the act creating the commission, upon which its powers depend. Before taking up the words of the statute the enormous scope of the power asserted for the commission should be em-phasised and dwelt upon.

The legislation that the commission may recommend embraces, according to the arguments before us, anything and everything that may be conceived to be within the power of Congress to regulate, if it relates to commerce with. foreign nations or among the- several States. And the result of the arguments is that whatever might influence the mind of the commission in its recommendations is a subject upon which it may summon witnesses before it and require them to disclose any facts, no matter how private, no matter what' their tendency to disgrace the person whose attendance has been compelled.

If we qualify the statement and say only, legitimately influence the mind of the commission in the opinion of the court called in aid, still it will be seen that the power, if it exists, is unparalleled' in its vague extent. Its territorial sweep also should be noticed. By § 12 of the act of 1887, the commission has authority to require the attendance of witnesses “ from any place in the- United States, at any designated place of hearing.” No such unlimited command over the liberty of all citizens ever was given, so far as we know, in constitutional times, to any commission or court.

How far Congress could legislate on the subject-matter of the questions put to the witnesses was one of the subjects of discussion, but we pass it by. Whether Congress itself has the unlimited power claimed by the commission, we also leave on ohe side. It was intimated that there was a limit in Interstate Commerce Commission v. Brimson, 154 U. S. 447, 478, 479. Whether it could delegate the power, if it possesses it, we also leave untouched, beyond remarking that so unqualified a delegation would present the constitutional difficulty in most acute form.

It is enough for üs to say that we find no attempt; to-make such a delegation anywhere in the act. Whatever may be the power of Congress, it did not attempt, in the act of February 4, 1887, c. 104, 24 Stat. 379, to do more than to regulate the interstate business of common carriers, and the primary purpose for which the commission was established was to enforce the regulations which Congress had imposed. The 'earlier sections of the statute require that charges shall be reasonable, prohibit discrimination and pooling of freights, require the publication of rates, and so forth, in well-known provisions.

Then, by § 11, the Interstate Commerce Commission is created, and by § 12, as amended by later acts, the commission has “authority to inquire into the management of.the business of all common carriers subject to the provisions of this act, and shall keep itself informed as to the manner and method in which the same is conducted, and shall have the right to obtain from such common carriers full and complete information necessary to enable the commission to perform the duties and carry out the objects for which it was 'created; and the commission is hereby authorized and required to execute and enforce the provisions óf this act.” District attorneys to whom the commission may apply are to institute and prosecute all necessary proceedings for the enforcement of the act and for the punishment of violations of it; and “for the purposes of this act the commission shall have power to require, by subpoena, the attendance and testimony of witnesses and the production of all books, papers, tariffs, contracts, agreements, and documents relating to any matter under investigation.” Then comes the provision to which we already, have called attention, by which a witness could be summoned from Maine to Texas, and then'follow clauses.for enforcing obedience to the subpoena by an order of court and for taking depositions, which do not heed statement.' The commission it will be seen is given power to require the testimony; of witnesses “for the purposes of this Act.” The argument for the commission is that the purposes of the act embrace all the duties that the act imposes and the powers that it gives the commission; that one. of the purposes is that the commission shall keep itself informed as to the manner and method in which the business of the carriers^ is conducted, as required by.§ 12; that another is that it shall recommend additional legislation under § 21, to which we shall refer again, and that for either of these general objects- it may call on the courts to require any one whom it may point out to attend and testify if he would avoid the penalties for- contempt. y/ We are of opinion on the contrary that the purposes, of the act for which the commission may exact evidence embrace only complaints for violation of the act, and investigations by the commission upon matters that might have been made the object of complaint. /As we already have implied the main purpose of the act was to regulate the interstate business of carriers, and the secondary purpose, that for. which the commission was established, was to enforce the regulations enacted.

These in our opinion are the. purposes referred to; in other words the power to require testimony is limited, as it usually is in English-speaking countries at least, to the only cases where the sacrifice of privacy is necessary — those where the investigations concern a specific breach of the law. That this is the' true view appears, we think, sufficiently from the original form- of § 14. That

section made it the duty of the commission, “whenever an- investigation shall .be made,” to make a report in writing, which was to “include the findings of fact upon which the conclusions of the Commission are based, together with its recommendation as to what reparation, if any, should be made by the common carrier to any party or parties who may be found to have been injured; and the findings so made shall thereafter, in all judicial proceedings,. be deemed prima facie evidence as to each.and every fact found.” As this applied, in terms, to all investigations, it is plain that at that time there was no thought of allowing witnesses to be summoned except in connection with a complaint for contraventions of the act, such as the commission was directed to. “investigate” by § 13, or in connection with an inquiry instituted by the commission, authorized by the same- section, “in the same manner and to the same effect as though complaint had been made.” Obviously such an inquiry-is limited to matters that might have been the object of a complaint.

The plain limit to the authority to institute an inquiry given by § 13, and the duty to make a report with findings of facts, etc., in the

section next following, with hardly a word between, hang together, and show the purposes for which it was intended that witnesses should be summoned-. They quite exclude the inference of broader power from the general words in § 12, as to' inquiring into the management of the business Of common carriers, subject to the provisions of the act, the commission keeping itself informed, etc. They equally exclude such an inference from § 21, the other

section on which most reliance is placed. That, as it now stands, requires' an .annual report, containing “such information and data collected by the Commission-as may be considered of value in the determination of questions connected with the regulation of commerce, tor gether with such recommendations as to additional legislation relating thereto as the Commission may deem necessary.” Act of March-2, 1889, c. 382, § 8, 25 Stat. 855, 862. It is true that in the latest amendment of § 14, findings of fact are required only in case damages are awarded. Act of June 29, 1906, c. 3591, § 3, 34 Stat. 584, 589.

But there is no change sufficient to affect the meaning of the words in § 12, as already fixed. If by virtue of § 21 the power exists to summon witnesses for the purpose of recommending legislation, we hardly see why, under the same section, it should not extend to summoning them for the still vaguer reason that their testimony might furnish data considered by the commission of value m the determination of questions connected with the regulation of commerce.

If we did not think, as we do, that the act clearly showed that the pqwer to compel the attendance of witnesses was to be exercised only in connection with the gwasvjudicial duties of the commission, we still should be unable to suppose that such an unprecedented grant was to be drawn from the counsels of perfection that have been quoted from §§12 and 21.

We could not believe on the strength of other than explicit and unmistakable words that such autocratic power was given.for any less specific object of inquiry than a breach of existing law,-in which, and in which alone, as we hate said, there is any need that personal matters should be revealed. In §§ 15 and 16 are farther provisions for the enforcement of the act, not otherwise material than as showing the main purposé that Congress had in mind. The only other

section that is thought to sustain the argument for the commission is § 20, amended by act of June 29, 1906, c. 3591, § 7, 34 Stat. 584, 593. • This. authorizes the commission to require annual reports from all the carriers concerned, with details of what is to be shown, to which the commission may add in certain particulars, and-further “to require from such carriers specific answers to all questions upon which- the Commission may need information.” The commission may require certain other reports, and is to have access to -all accounts, records and memoranda. The

section now deals at length with this matter and how accounts shall be kept and the like. It seems to us plain that it is directed solely to accounts and returns, and is imposing a duty on the common carrier only from whom the returns come. /All that we are considering is the power under the act to regulate commerce and its amendments to extort evidence from a witness by compulsion.

What reports or investigations the commission may make without that aid but with the help of such returns or special reports as it may require from the carrier, we need not decide,/ Upon the point before us we should \infer from the later action of Congress with regard to .its resolution of March 7, 1906, 34 Stat. 823, directing the commission to investigate and report as to railroad discrimination and monopolies in coal and oil, that it took the same view that we do. For it thought it advisable to amend that resolution on March 21 by adding a

section giving the commission the same power it then had to compel the attendance of witnesses in the investigation ordered. 34 Stat. 824. The mention of the power then possessed obviously is intended simply to, define the nature and extent of the power by reference to § 12 of the original act. The passage of the amendment' indicates that without it the power would be wanting.

The case is not af-flcted by' the provision of § 9 of the act of June 29, 1906, c. 3591, § 9, 34 Stat. 595, extending .the former acts relating to the attendance of witnesses and the compelling of testimony to “all proceedings and hearings under this Act.” If we felt more hesitation than we do, we still should feel bound to construe the statute not merely so as to sustain its constitutionality but so as to avoid a succession of constitutional doubts, so far as candor permits. Knights Templar & Indemnity Co. v. Jarman, 187 U. S. 197, 205. Order in 315 arid 316 reversed. Order in 317 affirmed. Petition denied. .

Mr. Justice Moody, not having been present at the argument, took no

part in the decision.