Full opinion text
GIBSON, Circuit Judge. This is a consolidated appeal by the United States in its capacity as a shipper (No. 19,863) and by other intervening .shippers (No. 19870) (hereinafter collectively referred to as shippers) from the judgment of a Three-Judge District Court in the District of Minnesota denying them restitution for excessive rates charged by appellees Middlewest Motor Freight Bureau and its operative interstate trucking carriers (hereinafter collectively referred to as carriers). Initially the carriers sued under 28 U.S.C. § 2325 and other applicable statutes to enjoin the Interstate Commerce Commission’s order canceling their then existing rates. This action called for the convening of a Three-Judge District Court.. After obtaining a temporary restraining order from the district judge, the carriers were denied an interlocutory injunction against the ICC order and lat- . er-requested and secured dismissal of ' their injunction request on the ground of mootness. In the meantime, the shippers had intervened in the action and had filed counterclaims for alleged excessive freight rates charged during the period of September 13 to 29, 1965, when, but for the intervention of the temporary restraining order, the ICC’s order canceling the rates would have been in effect. According to the brief of the National Small Shipments Traffic Conference, Inc., et al., the rate increases were estimated to amount to a minimum of $70,000 per day, making the cost to the public and the concerned shippers for the period involved at least $1,190,-000. The shippers contend this amount should be restored to them or. to the various shippers who were forced to pay the increased rates by reason of the court’s restraint of the ICC order. The carriers contend they are entitled to the rates collected for reasons hereafter discussed. An understanding of the facts of this controversy requires a brief explication of the regulatory scheme established by Congress by which rates of carriers of goods shipped in interstate commerce are determined. According to the provisions of the Interstate Commerce Act, 49 U.S. C. § 316 et seq., carriers are required to establish “just and reasonable rates” to be charged to shippers of goods. These rates are established by the carriers’ filing with the Interstate Commerce Commission tariffs (schedules) of the rates, fares, and charges to be applied by the carriers. The tariffs must be published as required by Commission regulations. The carriers may charge to shippers only the rates specified in the published tariffs. The tariffs, as filed and published by the carriers, are effective, unless the Interstate Commerce Commission finds in an administrative proceeding that they are not shown to be just and reasonable or that they are otherwise violative of the Act; but the Commission itself does not determine rates. If, after the various administrative procedures are followed, the Commission issues a final order rejecting a carrier’s tariff, there are three options open to the carrier to determine its operating rates: (1) it may revert to the immediately prior published tariff; (2) it may file a new tariff with the Commission, with higher or lower rates, and thus begin the administrative process anew; or (3) it may seek judicial review of the Commission’s order. In conjunction with this last option, an interlocutory or permanent injunction may be sought staying the Commission’s order, in which case a three-judge district court must be convened under 28 U.S.C. § 2325. Because the initiative for determining effective rates rests with the carriers and not with the Interstate Commerce Commission, and because the various administrative and judicial proceedings required to reach a final determination of •the lawfulness of the carriers’ rates are exceedingly complex, it often happens that in the interim between the filing of a tariff and the final disposition of that tariff, the carriers charge rates which are higher than ones to which they are entitled. In such a situation, the question arises of what remedies, if any are available to shippers who have paid the higher rates. In this ease we consider aspects of that pragmatic question. I. STATEMENT OF THE CASE The carriers filed tariffs with the Interstate Commerce Commission containing increased rates and charges on less than truckload (LTL) shipments and any quantity shipments in middlewest and central territories which were to take effect July 1, 1963. Upon the filing of a complaint by the shippers, the Commission suspended the new tariffs and ordered an investigation. Then on September 7, 1963, the suspension order was vacated by the ICC and the increased rates were permitted to take effect, but the investigation and hearing on the lawfulness of the tariffs was continued. The Commission issued its final report-and order on February 24, 1965, finding that “the proposed increases are not shown to be just and reasonable,” and ordering the tariffs canceled. The basis underlying the Commission’s report and order. was that the carriers had not met their burden of proof under 49 U.S.C. § 316 (g) justifying the increase in rates.LTL Class Rates & Minimum, Charges between Midwest and Central Territories, 325 I.C.C. 106 (1965). The effective date of the original order was April 14, 1965, but the carriers obtained several postponements of the order until an ultimate compliance date of September 13, 1965, was set. Throughout this period, the carriers had ample time to publish new tariffs with a statutory 30-day notice requirement, but failed to do so. On August 30, 1965, the ICC denied any further postponement of the compliance date. At this point, the carriers had the option of complying with the order or seeking judicial review. They chose review. On September 9, 1965, the carriers filed suit against the Government and the Commission to enjoin enforcement of the order, which was to take effect September 13. The district judge pursuant to 28 U.S.C. § 2284(3) issued a temporary restraining order and required the carriers to post a bond in the amount of $200,000 (later increased to $300,000) for the payment of damages in case the order was wrongfully restrained. The private shippers who had participated in the Commission proceedings sought and were allowed to intervene'as parties defendant to oppose the injunction against the ICC order, and were also allowed to file counterclaims against the carriers for damages arising out of the operation of the temporary restraining order on the ICC’s order of cancellation of the rates under review. The basis of the counterclaims was that the shippers were compelled to pay higher rates during the period of the temporary restraining order than they would have if ' the cancellation order had gone into effect. Later the Government was allowed to intervene in its capacity as a shipper and' filed a similar counterclaim. On September 24, 1965, the Three-Judge Court was convened to hear the carriers’ motion for an interlocutory injunction against the ICC order. The motion was denied, but the temporary restraining order was continued in effect until September 29, 1965, to permit the drawing up of findings and a final order. On September 29, the Three-Judge Court issued its findings of fact and conclusions of law denying the interlocutory injunction and dissolving the temporary restraining order. The decision rested primarily on three grounds: (1) the carriers failed to demonstrate a reasonable probability that the Commission’s order would be overturned; (2) the carriers had administrative remedies which would enable them to obtain increased rates; and (3) the magnitude of the loss to the public, combined with the “remote possibility” of the carriers’ success, justified denial of the interlocutory injunction. At this point in the litigation, the carriers found themselves in an uncomfortable legal situation. They were required by statute to charge only published tariffs, and they had published none other than those now effectively ordered canceled by the ICC. If they charged these tariffs, they faced the possibility of criminal sanctions under 49 U.S.C. § 322. If they charged new unpublished tariffs, even lower ones, they also incurred the possibility of criminal sanctions under that section. Whether or not this assessment of their legal position is in fact accurate is not material to this decision, but it nevertheless was a motivating factor in the further proceedings which ensued. The carriers immediately made an ex parte application to the Commission seeking another postponement of the cancellation order. On September 30, the Commission postponed the effective date of the order to October 11, without further change in the order, and also expressly required only one day’s notice and publication of the pre-existing lower rates. On October 5, the carriers filed a new tariff to take effect November 16, 1965, with rates which were even higher than those in the controverted tariff. On October 11, the carriers complied with the cancellation order and published the pre-existing lower rates of May 1964. The increased rates in the October 5 schedules went into effect on the scheduled date of November 16, 1965. The pendency of the suit in the Three-Judge District Court now presented a problem to the carriers. The denial of the interlocutory injunction strongly suggested that they had only a slight chance of winning their ease on the merits. If they proceeded to a hearing on the merits and lost, they would be liable on the bonds for a substantial amount of damages. Since they already had higher rates in effect which were no longer under investigation by ICC action, they proceeded to seek dismissal of the suit on the ground of mootness. On September 5,1968, the Three-Judge District Court on motion of the carriers dismissed the suit and counterclaims and discharged the bonds on the grounds that the rate increases mooted the issue of the validity of the cancellation order as between the ICC and the carriers. As to the shippers’ counterclaims, the Court held that the ICC order of September 30, 1965, postponing the compliance date with the cancellation order to October 11, was retroactive to the original September 13 compliance date; thus there was no effective cancellation order during the period of the temporary restraining order (September 13 to September 29), and consequently the shippers were not injured and had suffered no damages which could be awarded by virtue of the operation of the temporary restraining order. Following the issuance of the decision, the Government as statutory defendant and the Interstate Commerce Commission filed a joint statement with the court in which they denied that the September 30 order had any retroactive effect, contending that it was issued solely because of the court's stay of the original compliance date. In the light of this statement, the Three-Judge Court amended its original decision and accepted the Commission’s position that there was no retroactive effect of the September 30 order, but concluded that the equities of the situation did not justify the granting of any relief to the shippers. The question presently on this appeal is a relatively narrow one, namely whether the shippers are entitled to restitution from the carriers for the rates which were charged during the existence of the temporary restraining order, which rates were higher than those which could have been charged had the cancellation order gone into effect at the original compliance date of September 13. II. JURISDICTIONAL STATEMENT Neither party to this appeal has challenged our jurisdiction, but because of the rather unusual circumstances of the case, a brief jurisdictional statement is appropriate. The Three-Judge District Court below was convened pursuant to 28 U.S.C. § 2325 for the purpose of reviewing and considering the issuance of an injunction against the ICC order. Following the denial of the interlocutory injunction in September 1965, the carriers did not pursue judicial review of that order, but initiated new administrative proceedings before the Commission by filing new increased rates which became effective November 16, 1965. In September 1966, they moved in the District Court to strike the shippers’ counterclaims and dismiss the suit on the grounds that the questions _ were how moot. The district judge de- . nied the motion for the reason that the ancillary jurisdiction of the court had attached to determine the validity of the counterclaims, whose origin of course lay in the issuance of the temporary re- " straining order; the court reasoned that' determination of the countercláims_ re- _ quired resolution of the validity of the ICC order. Accordingly, the Three-Judge Court convened in July 1968, to - hear the merits of the suit, at which time the carriers again urged dismissal of the suit on the grounds of mootness. By its • ’ order of September 5, 1968, as modified ■ by the further order of April 9, 1969,- the Three-Judge District Court dismissed'the suit as moot and denied the shippers’ counterclaims on the grounds of a want of equity. The private shippers perfected a direct appeal to the United States Supreme Court from the order of the Three-Judge Court and also a protective appeal to this court. The Government qua shipper ap-. pealed only to this court. The carriers, the Government as statutory defendant, and the ICC moved to dismiss the direct appeal as moot, and the Supreme Court dismissed it for want of jurisdiction. National Small Shipments Traffic Conference, Inc. v. Middlewest Motor Freight Bureau, 396 U.S. Ill, 90 S.Ct. 395, 24 L.Ed.2d 304 (1969). This appeal is properly before us under the principles of Public Service Commission of Missouri v. Brashear Freight Lines, Inc., 312 U.S. 621, 61 S.Ct. 784, 85 L.Ed. 1083 (1941). .Under the principles of that case, the proper procedure in this case would have been for the Three-Judge District Court,-upon dismissing the case against the ICC for mootness, to have referred the counterclaims for restitution to' a-single judge for disposition, as the claim ■ for damages raised questions not within-the statutory purpose of a three-judge - district'court. Nevertheless, the failure' to follow this procedure does not invalidate the judgment, but merely renders a direct appeal to the Supreme Court under . .28 U.S.C. § 1253 inappropriate, and review is properly in this court. ' III. CONSTRUCTION OF THE ICC ORDER At the outset we must consider the construction and effect of the ICC order. The carriers contend that the ICC order ' neither rendered the tariff unlawful nor compelled a reduction in rates. If this contention is sound, then there is no need to consider the question of restitution, for there would be nothing to order resti- - tution for. Unfortunately, because of the procedural posture of this case, we do not have the benefit in this Court of the ■presence of the Commission itself, since its immediate interest in the case was terminated with the denial of the interlocutory injunction. Therefore, in order • to reach a decision on the issue, we must ...rely on the meager case law available and an analysis of the pertinent parts of the "record. Neither party has referred us to -any pertinent cases, though our own search has revealed a few indirectly relevant. As a preliminary matter, it is necessary •to make clear that in this part of the opinion we are dealing only with the construction and effect of the ICC order as it would operate as a valid administrative Order. The lawfulness of the order is no .longer at issue, and it must therefore be presumed valid. Interstate Commerce Commission v. Jersey City, 322 U.S. 503, 512, 64 S.Ct. 1129, 88 L.Ed. 1420 (1944). Nor is it material for purposes of this discussion that the carriers were allowed to collect the tariffs which were ordered canceled during the period of the temporary restraining order. The right to make that collection is not denied. Whether they have the right to keep the charges so collected is an entirely different matter, to be discussed below with reference to the availability of restitution. . We must here determine whether, •if the order went into effect, either because of carrier compliance or judicial enforcement, the result would be a reduction in the tariffs. The proceedings involving this tariff arose under § 216(g) of the Interstate Commerce Act, 49 U.S.C. § 316(g), which provides in pertinent part as follows: “Whenever there shall be filed with the Commission any schedule stating a new individual or joint rate, fare, charge, or classification for the transportation of passengers or property by a common carrier or carriers by motor vehicle, * * * the Commission is authorized and empowered upon complaint of any interested party * * * to enter upon a hearing concerning the lawfulness of such rate, fare, or charge. * * * At any hearing involving a change in a rate, fare, charge, or classification, * * * the burden of proof shall be upon the carrier to show that the proposed changed rate, fare, charge, classification, rule, regulation, or practice is just and reasonable.” When the carriers in this case filed their increased rates, the shippers filed a complaint protesting the increases and the ICC commenced a hearing under the above section. The proceeding terminated approximately 18 months later when the ICC issued its final order requiring the tariffs to be canceled. The grounds for this order were that the carriers had not sustained their burden of proof and had thus not shown that the schedules were just and reasonable. At this point, explanation of the differences possible among various ICC orders in rate proceedings of this sort provide some illumination of the problem we face. There are numerous reasons why a tariff may be unlawful under the Interstate Commerce Act. A rate may be unlawful because it is unreasonable — e. g., it is too high to be just or too low to be compensatory. A rate, even though reasonable, may be unlawful because it is discriminatory — e. g., shippers similarly situated are charged different rates, each of which by itself might be reasonable. A rate, even though reasonable and nondiscriminatory among shippers, may be unlawful because it is prejudicial to other interests the Act protects — e. g., it threatens the solvency of competing forms of transportation. A rate, even though reasonable, nondiscriminatory, and nonprejudicial, may nevertheless be unlawful because it is not filed in accordance with the terms of § 317(a). Further variations on this theme might be orchestrated but are not necessary for our immediate purpose. The variation with which we are concerned is whether a rate that is not shown to be just and reasonable is unlawful. We believe it is. The premise of this conclusion is the requirement of § 316(g) that the burden of proof is upon the carrier to justify any change in rates. The concept of burden of proof is a highly varying one depending on the circumstances of the issues involved; often it is merely a procedural rule which determines which party has the duty of producing evidence on a particular question. But often the concept is a far more significant one involving basically problems of substantive law. See 2 Davis, Administrative Law Treatise § 14.14 (1958). We think the instant statutory requirement is clearly substantive in nature, for the following reasons. The Commission may order a tariff canceled solely on the grounds that the carriers have failed to meet their burden of proof, provided of course that the requisite findings are made to support the order. Chicago & E. I. R. Co. v. United States, 107 F.Supp. 118 (S.D.Ind.1952), aff’d 344 U.S. 917, 73 S.Ct. 346, 97 L.Ed. 707 (1953). This is true even where the carriers have offered a considerable volume of evidence in support of the tariff. (This appears to have been conceded by the carriers in the proceedings below and is not contested here; their challenge to the validity of the Commission’s order was not that they had met their burden of proof under the appropriate standards, but that the Commission had changed these standards without affording them sufficient notice.) Thus the burden of proof requirement under this statute is not merely a procedural one requiring the carriers to produce some evidence justifying their changed tariffs. The proof they offer must be sufficient to positively justify the tariffs. The carriers contend that even though they have failed to meet their burden of proof, the tariff in issue is nevertheless lawful. That conclusion would not follow, even if they had met the burden of proof for purposes of § '316 (g). For it is well established that when the Commission holds a hearing on the lawfulness of a tariff and refuses to cancel it, even with a specific finding that it is not shown to be unlawful, it is not thereby converted into a lawful tariff. “ * * * [T]hey stand only as carrier-made rates which * * * leaves them open to possible recovery of reparations.” Interstate Commerce Commission v. Inland Waterways Corp., 319 U.S. 671, 687, 63 S.Ct. 1296, 1305, 87 L.Ed. 1655 (1943). If the fact that the carrier sus tains its burden of proof sufficiently - to convince the Commission to allow the tariffs to stand as carrier-made rates does not thereby convert them to lawful rates, it is self-evident that where the proof fails even to justify them as carrier-made rates and the Commission orders them canceled, they cannot be lawful. To sustain the carriers’ contention on this issue would mean that the Commission could order lawful rates canceled. That of course is contrary to the whole scheme of the rate-making process under the Interstate Commerce Act. The rationale of that process is that the carrier has the right to fix its own rates at any level it sees fit, so long as it complies with the terms of the Act and is, upon challenge, able to show that its rates are just and reasonable. The Commission, proceeding under § 316(g), investigates the “lawfulness” of the rates. Hence, if the Commission orders a tariff canceled, it must be because it was unlawful. If a tariff may be canceled because the carrier failed to sustain its burden of proof, then that failure must render the tariff unlawful. .'. It must be emphasized that we are here dealing with the lawfulness of the tariff following the effective date of the Commission’s cancellation order. If the cancellation order, based on the finding that .the tariffs were not shown to be just and reasonable, did not mean that the tariffs for the future would be unlawful, then the entire proceedings would be meaningless. The Commission did not let the tariffs stand as “carrier-made rates.” Nor did it, as it has in some cases, order the tariffs canceled without prejudice to their amendment. See Accelerated Transport-Pony Express, Inc. v. United States, 227 F.Supp. 815 (D.Vt.), aff’d, 379 U.S. 4, 85 S.Ct. 43, 13 L.Ed.2d 21 (1964). Nor did it leave open to the carriers the option of producing additional evidence to justify these tariffs. Positive cancellation was required. Cases dealing with orders of the Commission in this form have not addressed themselves specifically to this question of whether the tariffs ordered canceled were thereby rendered unlawful. Nevertheless, they seem to have proceeded upon this assumption, consistently with the above discussion. Language from the following two eases is indicative of this approach: “Upon submission and study the Commission reported that the new classification was unlawful, saying: ‘We conclude that the respondents [carriers] have failed to sustain their statutory burden of proof. ‘We find that the proposed changed rating has not been shown to be just and reasonable.’ ” Overnite Transportation Co. v. United States, 266 F.Supp. 88, 90 (E.D.Va.1967) (emphasis added). “But where, as here, the carrier has presented impressive evidence to support the proposed rate, the Commission may not hold the rate unlawful upon the mere statement that the carriers have not sustained their burden of persuasion.” New York Cent. R. Co. v. United States, 99 F.Supp. 394, 401 (D.Mass.), aff’d 342 U.S. 890, 72 S.Ct. 201, 96 L.Ed. 667 (1951) (emphasis added). See also Ringsby Truck Lines, Inc. v. United States, 263 F.Supp. 552 (D.Colo.1967), app. dis., 389 U.S. 576, 88 S.Ct. 689, 19 L.Ed.2d 775 (1968); Baltimore & O. C. T. R. Co., v. United States, 279 F.Supp. 270 (N.D.Ill.), aff’d, 389 U.S. 88, 88 S.Ct. 253, 19 L.Ed.2d 255 (1967). Due to the technicality of the concepts involved, as well as the distinct possibility of future misinterpretation of the import of this decision, it seems necessary here to expressly limit the sense in which we are applying the term “unlawful” to these tariffs. In holding that the tariffs are unlawful, we are not expressing any affirmative judgment that the rates embodied in them are in any substantive way violative of the Act — e. g., that they are unreasonably high or discriminatory. Such a judgment lies solely within the province of the Interstate Commerce Commission. Nor does this holding imply that the tariffs, were unlawful in any sense whatsoever prior to the Commission’s final order. This issue is not before us in this case, limited as we are solely to the period of the temporary restraining order following the effective date of the final order (September 13 to 29, 1965). Nor does the term “unlawful” in this context mean that the carriers could not collect the rates in the tariff during the period of the temporary restraining order; that they may or may not keep them after collection is discussed below in regard to the availability of restitution. The conclusion that the tariffs were unlawful is restricted to the sense that by virtue of the Commission’s cancellation order, as it operated prospectively, the carriers no longer had the right to maintain that particular tariff; maintenance of the tariff in violation of the order was unlawful. Having concluded that the cancellation order rendered the particular tariffs here in issue unlawful, we are next faced with the question of what was the actual effect of the order on the rates which the carriers could charge. The carriers contend that the effect of the order did not require them to reduce their rates. We pause to note here that, prior to the carriers’ raising this contention on appeal, there appears to have been absolutely no confusion on anybody’s part as to the meaning of the Commission’s order. The carriers, the shippers, the Commission, the Government, and the trial court all operated on the assumption that the effect of the Commission’s order was to require the carriers to cancel the increases and to revert, for some period of time at least, to the immediately prior rate levels. The insistence of the carriers now that the order did not require such a reduction is disingenuous, to say the least. Under normal circumstances, we would not feel obliged to deal with such a contention raised for the first time on appeal, especially where it is directly contrary to all the proceedings below. Nevertheless, since the proceedings below were focused primarily on the validity of the Commission’s order, rather than the problems of restitution, we feel constrained to examine the issue briefly. There is no case law on the subject to which we have been directed by the parties, nor have we found any. Lack of authoritative decisions indicates an accepted interpretation of the regulatory scheme whereby failure to justify rate increases accompanied by an order of cancellation would result in a reduction, in rates. First, account may be taken of the Commission’s proceedings in this case. The order of investigation which initiated the proceedings, dated June 28, 1963, was directed at the proposed increased less-truckload rates. In its final report, reported at 325 I.C.C. 106 (1965), the Commission made clear that its findings were directed solely at the carriers’ increases. “The increases became effective on September 7, 1963, and will be referred to herein as the proposed increases.” Id. at 107. In the discussion section, the Commission again emphasized its concern, not with overall-high - rates, but with carrier increases: “Numerous motor carrier general in: _ crease proceedings involving strong shipper opposition have been considered in the past several years. As a con-sequence the evidence presented to justify a general increase in fates -has been subjected to close scrutiny. •* - [T]he evidence is not convincing that this less-than-truckload traffic-, which generally is not susceptible of diversion to other modes of transportation, should be subjected to an additional in-. crease barely 1 year after the last increase became effective.” Id. at 121-122. . The Commission’s specific finding was that the “increases are not shown to be just and reasonable.” And the final order, dated August 31, 1965, denying further postponements and rehearings, again said that the “proposed increases found not shown to be just and reasonable have been ordered cancelled.” It is quite evident from this that the' Commission order did not mean that the earriérs’ entire rate structure was not just and reasonable, but only that the most recent increase was not shown to be just and reasonable. The obvious conclusion to be drawn is that the increases to be canceled would leave, the carriers with the rate structure as it existed just prior to the increases. That the carriers understood this exactly is clear both from the letter written to the Commission by carrier’s Attorney Feldman on August 30, 1965, and by their subsequent court suit. i In their complaint filed instituting a suit against the Commission order and applying for a temporary restraining order, the carriers specifically alleged that the order “requiring cancellation of increased rates and minimum charges to become effective September 13, 1965, would cause irreparable injury to plaintiffs * * (emphasis added). In. the affidavit in support of the motion for the temporary restraining order, the carriers reiterated the charge that the cancellation of the increases would cause irreparable damage, and presented specific figures indicating their financial position if the increases were left in their rates compared to the effect of omitting them from the rates if the order went into effect. Further explication of the extensive evidence in the record to this effect is unnecessary to this opinion. Finally we take specific note of the findings and order entered by the [Three-Judge Court denying the interlocutory injunction, Order of September 29, 1965. . Throughout this order, the court con- . sistently refers to the rate increases. Of specific interest here is the finding -Vll(c): “That the balancing of the equities in considering the magnitude of the losses and injury to the public if the interlocutory injunction is granted and if the Commission’s order is sustained by the Court, as compared with the losses to the carriers if the injunction is not granted, with the remote possibility of the Commission’s order being set aside, adequately justifies this Court, on this showing, in denying the motion for an interlocutory injunction.” This finding is obviously based on the premise that the Commission’s order requires a reduction in the carriers’ rates. Otherwise there could be no losses to the public. Despite this seemingly unanimous agreement by all parties in the trial litigation that the Commission order required cancellation of the rate increases, resulting in a reversion to the prior rate levels, the carriers now insist on appeal that that was not the effect of the Commission order. Just exactly what was the effect of the order in the carriers’ view is left uncertain, but the import of their position as quoted here leaves open several possibilities: “The tariff schedules at issue were not 'rate increase schedules’ as repeatedly characterized by the shippers * * * —but all schedules — and there then left no underlying, pre-existing schedules of rates and charges which would automatically have become effective upon cancellation of the schedules which are the subject of the case at bar. In other words, the challenged Commission order did not direct cancellation of merely an increase, or add-on, leaving an underlying rate structure, but swept away all basis for any charges for transportation services.” (Carriers’ Brief, p. 10). “By the order of cancellation the carriers were left entirely free to publish new rates, and those new rates could conceivably have been higher than, the same as, or lower than, the rates ordered cancelled.” (Carriers’ Supplemental Brief, p. 8.) At this point we pause in the argument to note that the ensuing analysis proceeds on the assumption that as of the September 13 effective date, the Commission order would have caused cancellation of the tariffs in question absent the temporary restraining order, either because of its self-executing nature or because of carrier compliance. The possibility that the carriers could have wilfully failed to comply with the order, and thereby blocked its effectiveness without becoming liable for refunds would make impotent the whole congressional scheme for review and consideration of tariffs. The Commission’s order of cancellation was served March 16, 1965,. to become final April 14, 1965. Subsequently, the compliance date of the order was extended to September 13, 1965. Throughout this period, the carriers were free to publish new tariffs with ample time for the thirty days notice requirement to be met. Whether those new tariffs could have been higher than, the same as, or lower than, the schedules ordered canceled is immaterial, for the fact of the matter is that they did not publish any new tariffs. (The record makes clear that at least one reason for failing to publish new tariffs which would have been higher was the carriers’ fear that the Commission would suspend them. This is also a fair indication that the carriers recognized the actual import of the cancellation order.) When the compliance date of September 13 arrived, the carriers had not published any new tariffs and the increased tariffs were to be canceled. If their argument that cancellation would leave them with no rates whatsoever which could be charged is correct, we could only conclude that as of that date they were bound to quit offering services to the public at all because of their dereliction in failing to publish new tariffs. But since even the shippers do not suggest such a harsh result, and since it seems rather contrary to common sense, we conclude only that the pre-existing lower rates should have come into effect at that time, either by operation of law or by the affirmative action of the carriers. In concluding that, in the absence of any carrier action to establish new rates where a tariff is found unlawful, the last lawful pre-existing rates are the effective rates to be applied by a court in considering restitution, we find an analogy in the case of Chicago, M., St. P. & P. R. Co. v. Alouette Peat Products, Ltd., 253 F.2d 449 (9th Cir. 1957). In that case, the carriers published increased rates which the court found to be unlawful because they failed to comply with the statutory 30-day notice requirement. The court acknowledged that the carriers were entitled to collect this rate because it was the only published rate on file, but ordered restitution to the shippers to the extent that this rate exceeded the immediately preceding one, because the higher rate had not been lawfully established. “No change having been legally made in the rate which existed before Ex Parte 162 [the one published on less than statutory notice], that rate was the only existing, legally established rate and the Court was bound to apply it.” 253 F.2d at 456. To summarize our holding on this aspect of the case, we conclude that the Commission order canceling the tariffs in issue rendered those tariffs unlawful as of the effective date of the order, with the consequence that the immediate prior lower rates should have been in effect and would have been in effect had not the temporary restraining order been issued. IV. RESTITUTION AS A REMEDY FOR LOSSES . SUFFERED . BY VIRTUE OF AN INJUNCTION The issuance of an injunction will in many eases cause financial losses to interested parties as well as prevent irreparable injury to the procurers. More importantly in cases such as this, where the restraint is directed against an order of an administrative agency charged with regulating rates to be charged to the public at large, the injunction may cause substantial losses to the general public which can never be adequately compensated. In such cases, it is the duty of the court issuing the injunction to take necessary measures to protect the interests of parties before it, as well as the public interest. (This was done in this ease by the issuing judge prudently requiring a substantial bond before issuing the temporary restraining order. The temporary restraining order is customarily issued, and usually ex parte, to maintain the status quo pending a detailed review on the merits.) For some time, it was thought to be the law in the federal courts that the only remedies available to parties injured by the issuance of an injunction were an action for damages on the injunction bond, if one had been required, in which ease the amount recoverable was limited to the amount of the bond, or, in the absence of a bond, an action for malicious prosecution where applicable. Russell v. Farley, 105 U.S. 433, 26 L.Ed. 1060 (1881). The substantial limitations inherent in these remedies are readily apparent. But in 1919, the Supreme Court significantly expanded the protection to be accorded injured parties by allowing recovery in the nature of restitution in cases where that remedy might be appropriate. Arkadelphia Milling Company v. St. Louis S. W. Ry. Co., 249 U.S. 134, 39 S.Ct. 237, 63 L.Ed. 517 (1919). The principles enunciated in Arkadelphia are central to the resolution of this case, and hence it will be examined in detail. The state of Arkansas, through an administrative agency, established rates to be charged by railroads for intrastate transportation of freight and passengers. The railroads brought suit in federal court, attacking the rates on the grounds that they were confiscatory. The district court issued an injunction, conditioned on a bond, restraining enforcement of the rates and ultimately issued a permanent injunction on the grounds that the rates were confiscatory. Upon entering the final decree, the bonds were dissolved. This decision was appealed, and the Supreme Court reversed the decree, holding that while the complaining railroads were justified in criticizing many of the tests applied by the State in determining the rates, they had failed to sustain their burden of proof that the rates were confiscatory. The complaint was ordered dismissed without prejudice, Allen v. St. Louis, I. M. & S. Ry. Co., 230 U.S. 553, 33 S.Ct. 1030, 57 L.Ed. 1625 (1912). On remand, the district court entered a decree in conformity with the mandate and referred the case to a master to determine the award of damages. The master awarded damages, measured by the excess rates charged by the railroads over those prescribed by the state commission, against the railroads and the sureties on the bonds for the period from the issuance of the injunction to the entry of the original decree and also for the period between the entry of the original decree and the entry of the final decree conforming with the mandate. The district court affirmed the master’s report and awarded judgment accordingly. On appeal to the Supreme Court, this judgment was affirmed with the modification that the sureties were not liable for the period following the final decrees since the bonds liad been dissolved at that time. The railroads in Arkadelphia made three, arguments which are pertinent to the instant case. First, they argued that the higher charges in force prior to the issuance of the permanent injunction were lawful charges by virtue of the temporary injunction; that the decision reversing the issuance of the permanent injunction operated prospectively only and did not determine that the temporary injunction was wrongfully issued; and that the condition of the bonds required a final decision on this issue in order to establish liability to the shippers. The Supreme Court disposed of this contention as follows: “But this is to construe the bonds according to the letter and not according to the substance. The state statute and the orders of the Railroad Commission entitled shippers to the benefit of the rates thereby established; and they were thus entitled at all times except as it became necessary to stay the operation of the rates by equitable process in order to permit of a judicial investigation into the question of their adequacy. The burden of proof to show them inadequate was upon the railway companies; and when they failed to sustain this burden they at the same time showed that the injunctions ought not to have been allowed.” Arkadelphia Milling Co. v. St. Louis S. W. Ry. Co., 249 U.S. 134 at 144, 39 S.Ct. 237 at 2411 (1919). Secondly, the railroads argued that as to damages occurring after the issuance of the permanent injunction, the reference to the master was only for the purpose of determining damages on the bonds, which liability was .discharged with the issuance of the permanent injunction, and that the permanent injunction itself created no liability on the part of the railroads to the shippers. This argument led to the Court’s significant holding that these damages were recoverable on the theory of restitution. This holding was based on the “principle, long established and of general application, that a party against whom an erroneous judgment or decree has been carried into effect is entitled, in the event of a reversal, to be restored by his adversary to that which he has lost thereby.” Id. at 145, 39 S.Ct. at 242. {See American Law Institute, Restatement of Restitution, § 74 (1937)). Finally, the railroads argued that since the reversal of the district court’s decree was “without prejudice,” the rights of the parties were left in doubt and thus there was no basis for the award of damages. The Court held that: “ * * * [T]he rights of the present shippers were so clear as to make an allowance of damages upon the injunction bonds and restitution upon the reversal of the decrees manifestly their due. That the reversal was ‘without prejudice’ did not deprive the decrees of conclusiveness as to past transactions, but only prevented them from being a bar to future suits for injunction upon a showing of changed conditions.” Id. at 147, 39 S.Ct. at 242. The carriers in the instant case seek to distinguish Arkadelphia on the following grounds. First, they argue that the jurisdictional bases for judicial review and restraint of the orders are different; in Arkadelphia, the jurisdiction of the court was founded on the denial of a constitutional right (confiscation of property in violation of due process), whereas here the right of review is accorded by statute (28 U.S.C.A. §§ 2284, 2324, 2325). We fail to perceive how this distinction makes a difference. In either case, the jurisdiction to issue the injunction is founded on traditional equity powers, and concomitant with the power to issue the injunction is the power to restore the parties to their rightful positions if the injunction is wrongfully issued. Surely it could not be contended that because Congress required that injunctions restraining orders of the Interstate Commerce Commission be issued by a three-judge court, instead of a single judge, it thereby expanded or contracted rights of the parties affected by that injunction. Secondly, the carriers argue that the lower rate was legislatively prescribed in Arkadelphia, whereas in this case there was no lower rate prescribed. We have disposed of this contention above. Finally, they contend that restitution was proper in Arkadelphia because there was no other remedy available in that case, while here § 304a of the Interstate Commerce Act provides another remedy. We will deal with this contention below in connection with other- defenses suggested by the carriers. .Following the decision in Arkadelphia, the Supreme Court applied its principles in numerous cases. In a case involving municipal regulation of gas utility rates, ... where a district court’s temporary injunction enjoining enforcement of the rates followed by a denial of a permanent injunction was affirmed as modified by the Supreme Court, it was held in a subsequent decision that the district court had jurisdiction to order refunds, through a special master, of the excess rates collected by the gas company by virtue of the temporary injunction, and indeed that retention of such jurisdiction was required by the principle of Arkadelphia. Ex parte Lincoln Gas & Electric Light Co., 256 U.S. 512, 41 S.Ct. 558, 65 L.Ed. 1066 (1921). Of particular interest with respect to the instant case is a contention made by the gas company regarding the extent of the period for which restitution should be required. The district court entered its first decree upholding the validity of the rate ordinance on September 23,1915, and dismissed the bill finally. The temporary injunction was continued, however, on a supersedeas bond to permit appeal by the gas company. On that appeal,'the Supreme Court affirmed the district court’s dismissal of the bill on the grounds that the rates were not proved to have been confiscatory during the period then involved, approximately 1908 to 1915. However, the Court took judicial notice that labor costs and returns on capital had increased substantially since the end of World War I and modified the dismissal to provide that it would be without prejudice to the institution of a new suit proving confiscation subsequent to the date of the final decree, September 23, 1915. Lincoln Gas & Electric Light Co. v. Lincoln, 250 U.S. 256, 39 S.Ct. 454, 63 L.Ed. 968 (1919). On remand, the district court ordered restitution for the period of the temporary injunction up to the date of the final decree, and also for the period following the final decree while the injunction was in effect pending the appeal. Appealing this order, the company contended that there was no liability for excess charges after the date of the final decree, because by virtue of the Supreme Court’s prior modification order, the validity of the ordinance was finally determined only up to the date of the final decree; since the bill was dismissed without prejudice to a new suit subsequent to that date there was no final adjudication of the validity of the ordinance rates subsequent to that date. But the Supreme Court held that restitution was proper for this period also, because the ordinance rate was presumptively valid and binding until the company successfully concluded a suit showing that it was noncompensatory. Ex parte Lincoln Gas & Electric Light Co., 256 U.S. at 518, 41 S.Ct. 558. Remedies available to parties who ■might be injured by the issuance of an injunction restraining an agency order were further expanded by the decision of the Supreme Court in Inland Steel Co. v. United States, 306 U.S. 153, 59 S.Ct. 415, 83 L.Ed. 557 (1939). In that case, the Interstate Commerce Commission found that certain allowances granted shippers by railroads were discriminatory and unlawful and ordered them canceled. The shippers sought an injunction restraining this order. The district court granted the injunction, but conditioned it on the payment of the contested allowances into a special account, subject to the order of the court, although neither the ICC nor the railroads requested such a condition. The Supreme Court held that the imposition of the condition was within the equity powers of the court in order to protect restitutional rights, relying on Arkadelphia and Ex parte Lincoln Gas.' Upon affirmance of the commission’s order, the special account was ordered restored to the railroad. Finally, in reviewing Supreme Court cases on this issue of restitution, we may note that the Court has emphasized the importance of protecting the interests of parties adversely affected by the issuance of injunctions against administrative orders by reversing decisions which failed to award restitution or damages where it was clearly due. See Baltimore & Ohio R. R. Co. v. United States, 279 U.S. 781, 49 S.Ct. 492, 73 L.Ed. 954 (1929); Public Service Commission of Missouri v. Brashear Freight Lines, Inc., 312 U.S. 621, 61 S.Ct. 784, 85 L.Ed. 1083 (1941). The principles enunciated in these Supreme Court decisions have been applied in numerous cases before the Courts of Appeals. Among those eases, we take specific note of two decided by our own Circuit. Berthold-Jennings Lumber Co. v. St. Louis, I. M. & S. Ry. Co., 80 F.2d 32 (8th Cir.), cert. denied, 297 U.S. 715, 56 S.Ct. 591, 80 L.Ed. 1001 (1935), involved a receivership proceeding in which the railroad was placed in receivership and a special master was appointed to determine claims against it. Certain shippers appeared in the proceeding before the special master and filed claims for rate overcharges against the railroad and also sought a preference for those claims. The alleged overcharges occurred under the following circumstances. The state of Missouri established by legislative action a schedule of maximum freight rates. The railroads obtained an injunction against those rates and during the period of injunction charged higher rates than permitted by the statute. The Supreme Court of Missouri ultimately sustained the validity of the legislation and dissolved the injunction. Applying the principles discussed above, this Court allowed the claims for overcharges against the railroads in the receivership proceeding, although for reasons not here material the demand for a preference was not allowed. Berthold-Jennings Lumber Co., supra at 40. A somewhat different problem confronted this Court in the case of Panhandle Eastern Pipe Line Co. v. Federal Power Commission, 154 F.2d 909 (8th Cir.), cert.. denied, 329 U.S. 761, 67 S.Ct. 110, 91 L.Ed. 656 (1946). There the pipe line company had challenged an order of the FPC ordering reduced rates on the transportation and sale of natural gas. A stay order against the Commission was granted by the Court of Appeals in order to permit the company to obtain review, but the stay was conditioned on the payment into court of the excess charges pending final determination. The Commission order was ultimately upheld and the Court was then faced with the problem of distributing the impounded funds. The specific question involved in Panhandle was whether the expense of distribution should be borne by the pipe line company or whether it should come out of the impounded funds, in effect making the expense of distribution fall on the consumers entitled to restitution. This Court held, relying in part on Inland Steel, supra, that the expense of distribution should fall on the company. This decision is consistent with the general principle that a party who obtains a benefit from an improperly issued injunction has the duty to restore that benefit to those who have been injured by the injunction. Finally, attention may be given to the case of Accelerated Transport-Pony Express, Inc. v. United States, 227 F.Supp. 815 (D.Vt.), aff’d, 379 U.S. 4, 85 S.Ct. 43, 13 L.Ed.2d 21 (1964). In that case, carriers challenged an order of the ICC finding that the carriers’ rates were not shown to be just and reasonable because certain charges for short hauls were higher than those for long hauls and ordering the tariffs canceled to the extent of this discrepancy. A temporary restraining order was obtained by the carriers, but on the final decision on the merits, a three-judge district court sustained the ICC’s order and dismissed the complaint. The proceedings following this dismissal are not reported, but counsel has made available to this court the pertinent documents which indicate substantial relevance to this case. Following the dismissal, a single judge of that court ordered a reference to a master pursuant to the bond required on the temporary restraining order in order to determine damages sustained by shippers and receivers of freight because of the temporary restraining order. In conjunction with the reference, the court ordered the shippers to file an accounting of all monies collected by them in excess of rates or charges which would have been applicable had the ICC’s order not been restrained. In the course of the proceedings before the master, it became apparent that the shippers and the carriers were in substantial disagreement over the rate basis of the accounting, and also that the accounting itself would amount to a considerable expense on the part of the carriers. Consequently, a settlement agreement was entered into by which the carriers agreed to pay approximately $469,000 into a fund to be administered by a trustee; out of the fund the trustee was to pay litigation expenses of the pri- or suit and also to pay claims for overcharges proved by injured parties. The government assented to this settlement, and the district court approved the stipulated agreement and discharged the bonds accordingly. The carriers in the instant case attack the relevance of Accelerated Transport as precedent. They contend that there was never any hearing on the primary issue of liability to make refunds, that there was never any decision that there was such liability, and that the stipulation itself does not confess such liability. Underlying this argument is the suggestion that the only reason the settlement was entered into was that the carriers were under coercion because of the even more expensive task of making an accounting to the master. However, the conclusion is inescapable that the reference to the master and the stipulation that was accepted in satisfaction of the liabilities and' rights entailed reflects that court’s decision that the carriers had a duty to answer for the damages caused by the improvident issuance of the temporary restraining order. We reject the position that the stipulation was a product of coercion; if the carriers believed that the reference to the master was improper, that order was appealable by means of a writ of mandamus. See 5 Moore’s Federal Practice jf 53.05 [3] (1969). Accelerated Transport is clearly entitled to precedential value on this issue. V. THE CARRIERS’ AFFIRMATIVE DEFENSES Against the foregoing authority, the carriers make the following affirmative contentions, based primarily on their interpretation of Part II of the Interstate Commerce Act: (1) first, they argue that restitution to shippers is precluded under the Interstate Commerce Act as interpreted by the Supreme Court, relying on Atlantic Coast Line R. R. Co. v. Florida, 295 U.S 301, 55 S.Ct. 713, 79 L.Ed. 1451 (1935); (2) secondly, they argue that § 304a of the Act provides an exclusive remedy of which the shippers have not availed themselves; (3) third, they argue that to order restitution in this case would contravene the express provisions of the Act that carriers may not make refunds to shippers from the published tariffs. A. Atlantic Coast Line R. R. v. Florida. In Atlantic Coast Line, supra, the Supreme Court denied restitution to shippers ; the facts of the controversy are as follows. Rail carriers in Florida had voluntarily established certain intrastate rates, which were later approved as maximum rates by an order of the Florida State Commission. The Interstate Commerce Commission instituted an investigation in which it found that those rates were confiscatory and resulted in discrimination against interstate commerce. It prescribed a new schedule of rates higher than those set by Florida. Florida sought judicial review of the ICC order, and the Supreme Court set aside the order on the grounds that the Commission had not made adequate findings. Florida v. United States, 282 U.S. 194; 51 S.Ct. 119, 75 L.Ed. 291 (1931). The Commission then held a new hearing, made new findings and prescribed its same higher rate schedule for substantially the same reasons as before. The Supreme Court affirmed this second order. Florida v. United States, 292 U.S. 1, 54 S.Ct. 603, 78 L.Ed. 1077 (1934). The State of Florida and other shippers meantime brought suit in the district court for restitution of the difference between the higher rates charged by the railroads and the approved state rates for the period between the issuance of the first invalid order of the ICC and the date of its ultimate reversal because of procedural defects in not supplying adequate findings justifying the order. The district court allowed partial restitution of these rates. The Supreme Court, in an opinion by Justice Cardozo, reversed, holding that the shippers were not entitled to restitution on these facts. Atlantic Coast Line R. R. Co. v. Florida, 295 U.S. 301, 55 S.Ct. 713, 79 L.Ed. 1451 (1935). Justice Cardozo's opinion specifically recognized that the principle of restitution was applicable to the situation, but held that the equities of that situation favored permitting the carriers to retain the charges, “ * * * restitution is without support in equity and conscience.” Id, 312-313, 55 S.Ct. 718. Three reasons were advanced as to these equitable considerations. First of all, the carriers had collected the higher rates by virtue of their compliance with the ICC order. The court noted that the carriers were not free to refuse obedience to the order. Secondly, the factual basis for the ICC order setting higher rates— the discrimination against interstate commerce by the lower rates — existed in fact at the time of that first order; and this discrimination was declared, unlawful by statute. The order was invalid for procedural reasons only (incomplete and inadequate findings), not because it was based on an improper determination of the facts. In other words, the factual justification for the higher rates was in existence at all times and had been specifically approved by the ICC. Thirdly, the lower rates which the shippers contended should be the measure of restitution were confiscatory. The Court observed : “A situation so unique is a summons to a court of equity to mould its plastic remedies in adaptation to the instant need.” 295 U.S. at 316, 55 S.Ct. at 719. Furthermore, the Court was expressly motivated in allowing the carriers to retain the higher rates by considerations of the deference due to the expertise of the ICC and of accommodation of the judicial process to the administrative process. Thus, to affirm the retention of the higher rates would be consistent with the action of the ICC, whereas to order restitution, in addition to being inequitable, would be inconsistent with the ICC’s action. The facts of the instant case contrast sharply with those of Atlantic Coast Line. Here, the carriers have charged higher rates, not in compliance with an ICC order, but in spite of that order and only by the use of judicial restraint subsequently held to have been improvidently granted. The ICC has ordered the increases in this case canceled, rather than ordering lower rates raised. In Atlantic Coast Line, the Commission found as a fact that the higher rates were justified, and this finding was ultimately sustained by the courts. Here the Commission found that the higher rates were not justified, and on the hearing for the interlocutory injunction, the court found that the carriers presented no evidence suggesting that this finding would likely be disturbed. The lower rates to which restitution was sought in Atlantic Coast Line were found by the Court to b