The Supreme Court yesterday agreed for the first time to review an Interstate Commerce Commission order suspending prices initially proposed by regulated companies - in this case, the major oil companies that own the Trans-Alaska Pipeline System.
The case involved the ICC's suspension last June 28 of the rates proposed by the companies to transport crude oil. These rates yield $1.5 million more per day than the interim rates set in the agency order.
In another action, the justices declined to review a decision that the government says exposed it to "hundreds of millions of dollars of potential liability" while producing "a windfall" for Ashland Oil Co.
The decision was handed down last May by the Tenth U.S. Circuit Court of Appeals in one of numerous cases involving helium, a non-combustible gaseous element that is mixed in nature with natural gas.
In the pipeline case, the justices rejected without comment the government argument that "the courts have no jurisdiction to review the correctness of the commission's determination that rates in excess of the interim rates allowed would have been probably unlawful. Suspension orders . . . are not reviewable."
On Oct. 20. The Supreme Court granted a petition by the pipeline owners - mainly subsidiaries of Mobil, Exxon. BP and ARCO - to stay the ICC interim rates.
Then. on Nov. 14, the court voted 4 to 3 to order the companies to keep records of the sums collected under their higher rates so that they will be able to make refunds if the court ultimately decrees one. It also allowed the Federal Energy Regulatory Commission to proceed with an investigation of the proposed rates.
Justice William J. Brennan Jr. said that the stay was "improvidently and precipitately issued," although he pointed out that he had been among those voting for it. In an opinion joined by Justice Thurgood Marshall, Brennan wrote:
"Because of the enormous sums of money that will be collected under our stay, over $100 million by Jan. 28. 1978. when the suspension order of the ICC ends . . . the court should be very clear that it is really needed to protect (the owners) and, more importantly, that the provisions of the stay adequately protect the interests of any one who may be affected by this litigation."
The third dissenter, Justice Harry A. Blackmun, also termed the grant of the stay "improvident."
In yesterday's action, the court allotted one hour for oral argument at an unspecified date. Justices Potter Stewart and Lewis F. Powell Jr. did not participate, as they had not in the Nov. 14 action. Neither did Justice Blackmun. who is convalescing from surgery.
The companies claim that the controversy, while affecting the State of Alaska's share of pipeline profits, will not affect consumer prices for petroleum products.
The rates they proposed were $6.04 to $6.44 a barrel compared with the ICC's interim rates of $4.68 to $5.10.
The helium case is rooted in 1960 program enacted by Congress to conserve the element by contracting with Phillips Petroleum and other so-called "Helex" firms to extract it from natural gas they acquired and sell it to the Interior Department. Helium, traditionally discharged as atmospheric waste when natural gas is burned, has little commercial value.
The program requires the Interior Department to indemnify Helex companies when the courts order them to pay suppliers for helium in excess of agree - upon amounts.
Yesterday, the Supreme Court acted in a 10-year-old case in which Ashland Oil, a producer-seller of helium-bearing natural gas, sued Phillips, claiming that the sale contract didn't include helium.
The government intervened, alleging that Phillips had paid Ashland for the helium when it bought the gas, and the government purchases ofa helium were virtually all that gave it value.
Ashland won 5 to 1 in the Tenth Circuit. Dissenting JudgeWilliam E. Doyle said that the majority had adopted a pricing formula that enables helium producers with claims pending in the appellate courts to collect an extra $328.5 million to $438 million from the government.
This is "dismal news," Doyle wrote.The producers are entitlted to "fair compensation" but that term does not mean "profits of the possible magnitude indicated here," he said. Similarly, Solicitor General Wade H. McCree, in the government's brief in the Supreme Court, said that the Tenth Circuit ruling "affronts ordinary concepts of value."
Phillips had asked the court to review the ruling, but it declined on Oct. 31; yesterday the court refused Phillips' request for a re-hearing.