Rapid Enterprises, LLC v. United States Postal Service

Court of Appeals for the Tenth Circuit·Decided June 10, 2025·No. 24-4041·Unpublished

Opinion

FILED

United States Court of Appeals UNITED STATES COURT OF APPEALS Tenth Circuit

FOR THE TENTH CIRCUIT June 10, 2025

Christopher M. Wolpert

Clerk of Court

RAPID ENTERPRISES, LLC, a Utah limited liability company, d/b/a Express One,

Plaintiff - Appellant,

v. No. 24-4041 (D.C. No. 2:22-CV-00627-JNP)

UNITED STATES POSTAL SERVICE; (D. Utah) UNITED STATES OF AMERICA,

Defendants - Appellees.

ORDER AND JUDGMENT*

Before HOLMES, Chief Judge, KELLY, and FEDERICO, Circuit Judges.

Plaintiff-Appellant Rapid Enterprises, LLC, dba Express One (“Express One”)

sued the United States Postal Service (“USPS”) for ten tort and contract claims. II Aplt. App. 312–31. Express One appeals the district court’s orders dismissing all ten of these claims for either lack of subject matter jurisdiction or failure to state a claim. Aplt. Br. at 17–18. Exercising our jurisdiction under 28 U.S.C. § 1291, we affirm.

*

This order and judgment is not binding precedent, except under the doctrines of law of the case, res judicata, and collateral estoppel. It may be cited, however, for its persuasive value consistent with Fed. R. App. P. 32.1 and 10th Cir. R. 32.1.

Background

The parties are familiar with the facts, and we need not restate them at length here.

Suffice it to say that, since 2013, Express One has contracted with USPS through a “reseller program,” which enabled Express One to purchase USPS products at discounted rates and sell them to private parties, retaining the difference as profit. II Aplt. App. 387. In 2019, the parties entered into a new contract (“the Contract”) to continue their reseller business. Id. at 449. Both parties had the right to terminate the Contract at any time upon 90 days’ notice. Id. at 361–62. In June 2022, USPS informed Express One that it was discontinuing the reseller program and terminating the Contract. Id. at 407–08.

Express One filed suit alleging that USPS implemented a scheme to steal its clients and destroy its business. Id. at 286–333. After the district court denied injunctive relief, IV Aplt. App. 845–47, Express One filed an amended complaint, asserting claims for: (1) breach of contract under the Postal Accountability and Enhancement Act (“PAEA”), (2) breach of the implied covenant of good faith and fair dealing, (3) breach of the implied duty to disclose superior knowledge, (4) misrepresentation in the inducement of a contract, (5) unjust enrichment, (6) misappropriation of trade secrets under the Defend Trade Secrets Act (“DTSA”), (7) misappropriation of trade secrets under Utah law, (8) common law misappropriation of trade secrets, (9) misappropriation of trade secrets as a Constitutional takings claim, and (10) estoppel.1 II Aplt. App. 312–31.

1 Express One’s eleventh claim did not state a cause of action, and merely requested declaratory and injunctive relief. II Aplt. App. 331–32. Express One does not appeal the dismissal of this claim, nor does it appeal the dismissal of claim five for unjust enrichment. See generally Aplt. Br.

The district court dismissed all of Express One’s claims in two orders. First, the district court dismissed claims one, four, six, seven, eight, nine, and ten, for lack of subject matter jurisdiction.2 III Aplt. App. 706–36. In a separate order, the district court dismissed Express One’s remaining claims for failure to state a claim. Id. at 750–75. We discuss the district court’s reasoning further below as it is relevant to this appeal.

Discussion

I. The district court properly dismissed most of Express One’s claims for lack of subject matter jurisdiction.

We review de novo the district court’s dismissal for lack of subject matter jurisdiction. Kline v. Biles, 861 F.3d 1177, 1180 (10th Cir. 2017). The party asserting jurisdiction bears the burden of establishing that subject matter jurisdiction exists. Id.

A. PAEA claims.

Express One’s PAEA claims arose under 39 U.S.C. § 404a, which restricts the Postal Service’s ability to establish rules precluding competition and prohibits it from offering services based on information obtained without consent. See id. at § 404a(a)(1) & (3). In turn, section 3662 of Title 39 of the United States Code provides that an individual who believes that the Postal Service has violated § 404a “may lodge a complaint with the Postal Regulatory Commission[.]” Id. at § 3662(a). Accordingly, the district court dismissed Express One’s § 404a claims because it found that the Postal

2 The district court noted that although Express One based only claim one in the PAEA, reference to the PAEA was interspersed throughout the amended complaint. III Aplt. App. 713. Accordingly, its ruling extended to claims two, three, four, and ten to the extent that they were based in the PAEA.

Regulatory Commission (“PRC”) had mandatory, exclusive jurisdiction over those claims. III Aplt. App. 715.

On appeal, Express One argues that the PRC’s jurisdiction under § 3662 is not mandatory, and thus the district court was not deprived of jurisdiction. Aplt. Br. at 23. Express One focuses on § 3662’s “permissive” language, stating that an individual suing under § 404a “may lodge a complaint with the [PRC].” 18 U.S.C. § 3662(a) (emphasis added). Relatedly, 39 U.S.C. § 409(a), states that “[e]xcept as otherwise provided in this title, the United States district courts shall have original but not exclusive jurisdiction over all actions brought by or against the Postal Service.”

This court has never squarely addressed whether § 3662 vests the PRC with mandatory, exclusive jurisdiction over § 404a claims. However, this court has held in two unpublished decisions3 that the PRC has mandatory, exclusive jurisdiction over claims arising under 39 U.S.C. § 403(c), which is enumerated alongside § 404a in § 3662. See White v. United States Post Office, No. 23-1239, 2024 WL 2973705, at *2–3 (10th Cir. June 13, 2024); Bovard v. U.S. Post Office, No. 94-6360, 1995 WL 74678, at *1 (10th Cir. Feb. 24, 1995). This is because “[t]he language of section 3662 makes clear that a postal customer’s remedy for unsatisfactory service lies with the Postal [Regulatory] Commission[.]” Bovard, 1995 WL 74678, at *1. The Federal Circuit examined this same language in Foster v. Pitney Bowes Corp., 549 F. App’x 982 (Fed.

3 Although not precedential, we find the reasoning of these and the other unpublished opinions cited in this decision to be instructive. See 10th Cir. R. 32.1(A).

Cir. 2013), and held that Congress intended a plaintiff alleging violations of § 404a “to exhaust the PRC process before challenging an adverse ruling[.]” Id. at 984–86.

We agree that § 3662’s grant of jurisdiction over § 404a claims to the PRC is mandatory and exclusive. “Generally, when Congress creates procedures designed to permit agency expertise to be brought to bear on particular problems, those procedures are to be exclusive.” Free Enter. Fund v. Pub. Co. Acct. Oversight Bd., 561 U.S. 477, 489 (2010) (quotations omitted). The district court correctly explained that “as used in § 3662, the term ‘may’ means only that an aggrieved party is not required to file a complaint, but to the extent they elect to do so, it must be filed with the PRC.” III Aplt. App. 715 n.3. Express One’s reliance on § 409 and its general grant of jurisdiction is misplaced because that grant is subject to exceptions within the title. See 39 U.S.C. § 409(a). “Section 3662, with its grant of jurisdiction to the PRC over claims arising under § 404a, provides such an exception.” Foster, 549 F. App’x at 986.

Free access — add to your briefcase to read the full text and ask questions with AI

Rapid Enterprises, LLC v. United States Postal Service, (10th Cir. 2025).

Rapid Enterprises, LLC v. United States Postal Service (Rapid Enterprises, LLC v. United States Postal Service) — published by Counsel Stack Legal Research, free access to 12M+ legal documents.

Related

Precision Pine & Timber, Inc. v. United States
596 F.3d 817 (Federal Circuit, 2010)
Block v. Neal
460 U.S. 289 (Supreme Court, 1983)
Office of Personnel Management v. Richmond
496 U.S. 414 (Supreme Court, 1990)
Burkins v. United States
112 F.3d 444 (Tenth Circuit, 1997)
Duplan v. United States
188 F.3d 1195 (Tenth Circuit, 1999)
St. Christopher Associates, L.P. v. United States
511 F.3d 1376 (Federal Circuit, 2008)
EUGENE S. v. Horizon Blue Cross Blue Shield
663 F.3d 1124 (Tenth Circuit, 2011)
Bovard v. U.S. Post Office
47 F.3d 1178 (Tenth Circuit, 1995)
Foster v. Pitney Bowes Corporation
549 F. App'x 982 (Federal Circuit, 2013)
Thomas v. Kaven
765 F.3d 1183 (Tenth Circuit, 2014)
America West Bank Members L.C. v. State
2014 UT 49 (Utah Supreme Court, 2014)
Lopez v. United States
823 F.3d 970 (Tenth Circuit, 2016)
Kline v. Biles
861 F.3d 1177 (Tenth Circuit, 2017)
United States v. Turley
878 F.3d 953 (Tenth Circuit, 2017)
Nelson v. Board of County Commissioners
921 F.3d 925 (Tenth Circuit, 2019)
United States v. Leffler
942 F.3d 1192 (Tenth Circuit, 2019)