This suit in equity was brought by petitioner in the District Court for Southern New York to restrain respondent, a United States customs officer, from seizing merchandise transported by petitioner's vessels in coastwise traffic, in alleged violation of section 27 of the Merchant Marine Act of June 5, 1920, c. 250, 41 Stat. 988, 999, 46 U.S.C. § 883 (46 USCA § 883). An interlocutory order of the District Court restraining the seizure and forfeiture of the merchandise thus transported was reversed and set aside by the Court of Appeals for the Second Circuit, on the ground that the transportation was a plain violation of the statute. 71 F.(2d) 273. This Court granted certiorari, 293 U.S. 542, 55 S.Ct. 100, 79 L.Ed. --, upon a petition which the government, considering the question one of importance, did not oppose.
Petitioner is a Maine corporation, engaged in operating a steamship line on Long Island Sound between New London, Conn., and New York City, employing vessels built in the United States and documented under its laws. All of petitioner's shares of stock, with the exception of directors' qualifying shares, are owned and held by the Central Vermont Railway, Inc., a Vermont corporation, which is an interstate rail carrier, with its railroad extending northward from New London to points in Connecticut, Massachusetts, and Vermont. The railway's stock, except directors' qualifying shares, is held in turn by the Canadian National Railway Company, a Canadian corporation. The acquisition of stock of petitioner by the Central Vermont Railway, Inc., and of the latter's stock by the Canadian National Railway Company were duly approved by the Interstate Commerce Commission. 40 I.C.C. 589; 158 I.C.C. 397, 405, 406.
Petitioner and Central Vermont Railway, Inc., maintain a line for transportation of merchandise by rail and water, by continuous carriage, between points in the New England States and New York City. About two-thirds of the freight passing over the line either originates at points in the Northwestern States and is routed over Canadian rail lines and thence over the Central Vermont rail and water line to New York City or passes over the same route in the other direction. These through routes have been recognized by the Interstate Commerce Commission, and tariffs for them have been filed with the Commission. The remainder of the traffic originates in New England or New York City, and moves between those points. All the freight which moves by petitioner's boats between New London and New York City is therefore transported over the whole or some part of a through route recognized by the Interstate Commerce Commission.
Respondent has seized merchandise which had been shipped over the Central Vermont from St. Albans, Vt., to New London, and carried thence by petitioner's vessel to New York City, and threatens to seize other articles carried by petitioner's vessels upon shipments between points in New England and New York City. Petitioner contends that the threatened seizures, which will work irreparable injury to its business, are unauthorized by section 27, because: (a) Not within its prohibition; (b) it does not apply to petitioner or the merchandise which it transports, because of the paramount, and therefore exclusive, jurisdiction of the Interstate Commerce Commission over the traffic in which petitioner participates; and (c) if applicable to them, it infringes the due process clause of the Fifth Amendment.
1. Section 27 of the Merchant Marine Act (46 USCA § 883) prohibits the transportation of merchandise, under penalty of its forfeiture, 'by water, or by land and water,' between points in the United States 'in any other vessel than a vessel built in and documented under the laws of the United States and owned by persons who are citizens of the United States: * * * Provided, That this section shall not apply to merchandise transporfed between points within the continental United States, excluding Alaska, over through routes (heretofore or hereafter) recognized by the Interstate Commerce Commission for which routes rate tariffs have been or shall (hereafter) be filed with said commission when such routes are in part over Canadian rail lines and their own or other connecting water facilities. * * *'
