Atlantic Coast Line R.R. v. Standard Oil Co
In Atlantic Coast Line R.R. v. Standard Oil Co., 275 U.S. 257, 48 S.Ct. 107, 72 L.Ed. 270 (1927), where the Supreme Court held that the intrastate transport of imported oil from coastal storage facilities to inland bulk stations constituted intrastate commerce. Id. at 273, 48 S.Ct. at 112.
In that case, the Standard Oil Company of Kentucky maintained oil tanks and warehouses in Florida. Standard purchased oil from various refiners who transported the oil by sea to the Florida storage facilities. Title to the oil did not pass to Standard until after the oil had been delivered. Standard then transported the oil by rail and motor carrier to its 123 bulk stations throughout Florida.
These bulk stations serviced the oil needs of Standard's Florida customers. The issue in the case was whether Standard's reshipment of the oil to its bulk stations was interor intrastate commerce for the purpose of determining the applicable shipping rates.
The Supreme Court began its analysis by stating that to determine whether commerce is interor intrastate, courts must analyze "the essential character of the commerce," id. at 268, 48 S.Ct. at 110, and that this character must be determined by examining the facts. Id. at 269, 48 S.Ct. at 110-11.
The Court then stated: "The important controlling fact in the present controversy, and what characterizes the nature of the commerce involved, is that Standard's whole plan is to arrange deliveries of all of its oil purchases on the seaboard of Florida so that they may all be there stored for convenient distribution in the state...." Id.
The storage facilities, the Court believed, were the "natural places for a change from interstate and foreign transportation to that which is intrastate, and there is nothing in the history of the whole transaction which makes them otherwise, either in intent or in fact." Id.
The Court concluded: "We have no hesitation in saying that the nature of the commerce in controversy in this case was intrastate." Id. at 270, 48 S.Ct. at 111.
In Atlantic Coast Line, the situation was vastly different: "There is nothing to indicate that the destination of the oil is arranged for or fixed in the minds of the sellers beyond the primary seaboard storages...." 275 U.S. at 269, 48 S.Ct. at 111. The Court noted that neither the sellers that shipped the oil nor the railroad company that delivered the oil to the storage facilities had any involvement with determining the oil's ultimate destination. Id.