So, if you look at the above linked decision, it dates from 1973, four years before McCloud got their cars. Quick summary and interpretation, Florida East Coast and Seaboard Coast Line filed suit around 1968 against the incentive per diem program. I could not in a quick skim see what happened at the District Court level, but a three judge panel in the appeals court ruled in favor of the two railroads based solely on grounds that the ICC violated the Administrative Procedures Act in formulating the Incentive Per Diem rules. The government then appealed that decision to the Supreme Court, which ruled in favor of the government. This ruling is the resulting decision from the District Court level officially implementing the decision of the Supreme Court upholding the incentive per diem rules in their entirety and instructing the two plaintiff railroads to pay all accrued incentive per diem charges, somewhere earlier in this case there had been an injunction issued that relieved only those two carriers from having to pay them but had instructed both to record what payments should have been had the injunction not been issued. So, this was not the decision that ended the program.

What did kill incentive per diem was fairly intense lobbying conducted by a number of Class 1 carriers, most of whom, especially bridge carriers, more often than not calculated the incentive per diem charges assessed against them for the time such cars spent on their rails exceeded the revenues they received for moving the car. There very well may have been some legal action, but eventually the railroads got the program discontinued once they were able to prove the harm caused by the unbalanced economics.

Jeff Moore
Elko, NV