United Parcel Service, Inc. v. United States Portal Service

455 F. Supp. 857, 1978 U.S. Dist. LEXIS 16514
CourtDistrict Court, E.D. Pennsylvania
DecidedJuly 19, 1978
DocketCiv. A. 77-3620
StatusPublished
Cited by23 cases

This text of 455 F. Supp. 857 (United Parcel Service, Inc. v. United States Portal Service) is published on Counsel Stack Legal Research, covering District Court, E.D. Pennsylvania primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
United Parcel Service, Inc. v. United States Portal Service, 455 F. Supp. 857, 1978 U.S. Dist. LEXIS 16514 (E.D. Pa. 1978).

Opinion

OPINION AND ORDER

EDWARD R. BECKER, District Judge.

I. Preliminary Statement

This case raises the question whether the United States Postal Service may, without notice, hearing, or prior submission to the Postal Rate Commission, conduct limited and temporary experiments in which proposed new mail classifications, offered at heretofore unavailable rates, are tested in the marketplace or, conversely, whether the institution of such experimental postal services is subject to the procedures governing changes in permanent rates and classifications. 1 The question appears to be one of first impression.

The United States Postal Service and the postal procedures at issue in the case at bar find their common genesis in the Postal Reorganization Act of 1970, Pub.L. 91-375, 84 Stat. 719 (codified at 39 U.S.C. §§ 101-5605) [hereinafter “Act”]. Passage of the Act signalled a major change in the structure and accountability of the postal bureaucracy. Critics of the Post Office Department claimed that the Post Office was at once over-political and under-efficient, see generally H.R.Rep. No. 91-1104, 91st Cong., 2d Sess., reprinted in [1970] U.S.Code Cong. & Admin.News, pp. 3649, 3651-54, 3660-61; S.Rep. No. 91-912, 91st Cong., 2d Sess. 1-3 (1970); President’s Commission on Postal Organization, Towards Postal Excellence (1968), and that the Postmaster General was generally powerless to take the kind of extensive remedial action necessary to affect significantly the Department’s all too apparent ills, see S.Rep., supra, at 3. 2

Congressional response to these postal maladies was far-reaching. The Post Office was taken out of the Cabinet and established as the United States Postal Service, an independent unit of the executive branch. 39 U.S.C. § 201. Under the new system, the Postmaster General is no longer appointed by the President; rather, the *860 President appoints the nine Governors of the Postal Service, no more than five of whom may be from the same political party. The Governors, who serve for rotating nine year terms, appoint the Postmaster General and Deputy Postmaster General and set the latters’ tenure and compensation; the Governors and their two appointees become the Board of Governors of the Postal Service. Id. § 202.

The Postal Reorganization Act gives to the Postal Service increased control of and responsibility for postal operations and management, free of the formal and direct supervision of the legislative and executive branches. Thus, the Postal Service is empowered to sue and be sued in its own name, to adopt rules and regulations, to enter into and perform contracts, to keep its own system of accounts, to acquire and dispose of property, etc. Id. § 401. To professionalize and depoliticize the Postal Service even further, a postal career service was established, id. § 1001(a), provision was made for hiring executives, id. § 1001(c), and otherwise upgrading postal management, id. § 1004, and political recommendations on personnel matters were prohibited, id. § 1002. As to employee-management matters, collective bargaining was made applicable to postal service employees, with provision for binding arbitration in the event of lack of agreement, id. §§ 1202-1207, and postal employees were granted the right to work, id. § 1209(c).

Reform in the area of setting postal rates and classes was at least as thoroughgoing as the other reforms just referred to. Congress abandoned the business of postal rate-making and established a quasi-regulatory agency, the bipartisan Postal Rate Commission. The Commission, which is independent of the Postal Service and the members of which serve for rotating six year terms, was given primary responsibility for overseeing changes in postal rates, classes, and services. Id. §§ 3601-3604. Although the Governors of the Postal Service are charged with the establishment of fair and equitable classes of mail and postal rates and fees, id. § 3621, before instituting such rates or classes the Postal Service must request recommended decisions from the Postal Rate Commission, id. §§ 3622 & 3623. The Commission is to hold evidentiary hearings under 5 U.S.C. §§ 556 & 557 (Administrative Procedure Act) pursuant to regulations that it may establish, 39 U.S.C. § 3624, to evaluate the proposed rates or classes of mail according to criteria established by Congress, id. §§ 3622 & 3623. Upon receiving the recommended decision of the Commission, the Governors of the Postal Service may approve, allow under protest, reject, or modify the decision in accordance with specific statutory provisions. Id. § 3625. If no decision is forthcoming from the Commission within a specified period of time, the Postal Service may, upon ten days notice in the Federal Register, establish temporary changes in rates or classes in accordance with the proposed changes under consideration by the Commission. Id. § 3641. 3 Pro *861 posed changes in the nature of postal services that will generally affect service on a nationwide or substantially nationwide basis must also be submitted to the Commission for hearing and an advisory opinion before such changes may be instituted. Id. § 3661.

Responding to its congressional mandate to “plan, develop, promote, and provide adequate and efficient postal services at fair and reasonable rates and fees,” id. § 403(a), in mid-October of 1977 the Postal Service instituted an experimental parcel delivery service that is scheduled to last approximately twelve months. Under this test program, which is not available to the public generally, about twenty selected shippers 4 in five metropolitan areas 5 entered into service agreements with the Postal Service. These agreements provide that parcels mailed by the test participants, when suitably packaged for bulk mail processing,® will be assessed postage based upon the average weight of such packages. For example — and subject to the distance limitations set out in note 7 infra —regardless of the actual weight of any given package, if the average weight of the pieces tendered, based on sample weighings, is five pounds or less, postage for each parcel is $.87; if the average weight of the packages is more than five but not more than twenty pounds, postage for each parcel is $1.15. These charges are significantly less than the generally available parcel post rates of the Postal Service.

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Bluebook (online)
455 F. Supp. 857, 1978 U.S. Dist. LEXIS 16514, Counsel Stack Legal Research, https://law.counselstack.com/opinion/united-parcel-service-inc-v-united-states-portal-service-paed-1978.