This case, which comes here by direct the peal under § 266 of the Judicial Code, 28 U.S.C. § 380, 28 U.S.C.A. § 380, involves the meaning of an order of the Interstate Commerce Commission and its application to the Illinois intrastate commutation passenger fares of the Chicago & North Western Railway. By interlocutory and finally by permanent injunction, the district court below of three judges has enjoined appellants, the Illinois Commerce Commission and named law enforcement officers of the state, from taking any steps to prevent a 10% increase in such fares by appellee, trustee of the Chicago & North Western Railway Company in reorganization under § 77 of the Bankruptcy Act, 11 U.S.C.A. § 205. The 10% increase, if effective, would bring the fares in some instances above the maximum of two cents per mile imposed by state statute. Illinois Revised Statutes, 1941, c. 114, §§ 154-156.
The bill of complaint alleges, and the district court found, substantially as follows: Until March 7, 1942, appellee and his predecessor in interest, the Chicago & North Western Railway Company, had collected commutation fares for the intrastate transportation of passengers in Illinois as required by a report and order of the Interstate Commerce Commission entered October 6, 1925, in a proceeding under § 13 of the Interstate Commerce Act (now 49 U.S.C. § 13, 49 U.S.C.A. § 13). The purpose and effect of that order was to require the Chicago & North Western to increase its intrastate commutation fares to substantially the same level as the fares then in force for interstate passenger traffic, which had previously been increased by order of the Commission, and thus to remove undue preference and prejudice and unjust discrimination against interstate commerce, as well as undue preference and advantage to persons traveling in intrastate commerce on the Illinois lines of the Chicago & North Western. The order was entered upon appropriate findings. In re Intrastate Rates Within Illinois, Docket No. 11703, 102 I.C.C. 479. It directed an increase of 20% over the then prevailing rates for the intrastate commutation fares involved in this case, but provided that this increase should be 'subject to a maximum charge of 2 cents per mile', the Commission's opinion stating that this was 'in deference to the State statute'. 102 I.C.C. at page 485.
On February 28, 1936, the Interstate Commerce Commission, after a general and nationwide investigation of railroad passenger fares, entered an order by which it retained its continuing jurisdiction over the Illinois intrastate commutation passenger fares here in question, by specific reference to its previous order in Docket No. 11703, although the order did not require any modification of those fares. Passenger Fares and Surcharges, Docket No. 26550, 214 I.C.C. 174.
In December 1941, the Commission undertook a further nationwide investigation of both freight rates and passenger fares to determine whether increases of 10%, as asked by the railroads, should be authorized in view of increased operating expenses and costs of materials and supplies. By order of January 21, 1942, in that proceeding, known as Ex parte No. 148, the Commission-upon findings that the increase was necessary for adequate and efficient service during the war emergency-authorized the railroads, including the Chicago & North Western, to increase passenger fares by 10%. The order further directed that 'all outstanding orders, as amended, of the Commission, authorizing or prescribing interstate and intrastate fares, or bases of fares be, and they are hereby, modified, effective concurrently with the establishment of the increased fares' approved by the order, but only to the extent necessary to permit the authorized increase to be added to 'the interstate and intrastate fares approved or prescribed in, or maintained or held by virtue of, said outstanding orders'; that a copy of the order be filed 'in the docket of each such proceeding, including those proceedings under § 13 of the Interstate Commerce Act enumerated in the order of February 28, 1936, in Docket No. 26550'; and 'that all tariffs or supplements changing fares by authority of this order, which are maintained or held by authority of outstanding orders of the Commission, shall bear on their title pages specific reference to this order'. In a report and order of March 2, 1942, in Ex parte No. 148, the Commission reaffirmed these findings, authorized certain increases in freight rates, and made further findings of fact in support of the increases. Increased Railway Rates, Fares and Charges, 1942, 248 I.C.C. 545.