US SUPREME COURT DECISIONS

In a railroad reorganization under § 5 of the Interstate Commerce Act, as amended by the Transportation Act of 1940, a Virginia corporation, with the approval of the Interstate Commerce Commission, succeeded to the ownership and operation of a unitary railroad system in six states, including South Carolina. In granting its approval, the Commission found that, for the corporation to comply with the laws of South Carolina forbidding the ownership and operation of railroads in the State by foreign corporations would result in "substantial delay and needless expense," and "would not be consistent with the public interest." The corporation sued in the Supreme Court of South Carolina to enjoin the State Attorney General from enforcing these state laws against it or collecting the heavy statutory penalties for noncompliance.

Held:

1. The State Supreme Court had jurisdiction of the suit, with power to determine whether the Commission's order exempted the corporation from compliance with the state railroad corporation laws and, if so, whether the Commission had transcended its statutory authority in making the order. Pp. 333 U. S. 122-123. chanrobles.com-red

Page 333 U. S. 119

2. The Commission's order was intended to exempt the corporation from obedience to the State's laws forbidding foreign corporations to own or operate railroads in the State. P. 333 U. S. 124.

3. The Commission was authorized to issue such an order by § 5 of the Interstate Commerce Act, as amended by the Transportation Act of 1940. Texas v. United States, 292 U. S. 522. Pp. 333 U. S. 124-126.

4. It was not prevented from doing so by § 5(11), which forbids creation of a federal corporation but authorizes a state railroad corporation to exercise the powers therein granted in addition to those bestowed upon it by the state of its creation. Pp. 333 U. S. 126-127.

5. The corporation is entitled to the injunction it sought. P. 333 U. S. 127.

211 S.C. 122, 43 S.E.2d 839, reversed.

The Supreme Court of South Carolina dismissed a suit brought therein by a Virginia railroad corporation to enjoin the Attorney General of South Carolina from enforcing against it certain state laws forbidding foreign corporations to own or operate railroads in the State. 211 S.C. 122, 43 S.E.2d 839. On appeal to this Court, reversed and remanded, p. 333 U. S. 127.