Newsweek, Inc. v. U.S. Postal Service
| Decision Date | 02 November 1981 |
| Docket Number | Nos. 1567-1570,D,AFL-CIO,s. 1567-1570 |
| Citation | 663 F.2d 1186 |
| Parties | NEWSWEEK, INC., Time Incorporated, Magazine Publishers Association, Inc., Council of Public Utility Mailers, Reader's Digest Association, Inc., and United Parcel Service of America, Inc., Petitioners, v. UNITED STATES POSTAL SERVICE, Respondent, Warshawsky & Company, American Business Press, Inc., Dow Jones & Company, Inc., International Labor Press Association,/CLC, Parcel Shippers Association, Direct Mail/Marketing Association, Inc., March of Dimes, Mail Order Association of America, Association of American Publishers, Inc., Recording Industry Assoc. of America, Inc., National Association of Greeting Card Publishers, Magazine Publishers Association, Inc., Classroom Publishers Association, American Lung Association, National Easter Seal Society, St. Jude Children's Research Hospital, American Cancer Society, and National Wildlife Federation, Intervenors. COUNCIL OF PUBLIC UTILITY MAILERS, Petitioners, v. UNITED STATES POSTAL SERVICE, Respondent, Newsweek, Inc., Dow Jones & Company, Inc., Time Incorporated, Association of American Publishers, Inc., Recording Industry Assoc. of America, Inc., Parcel Shippers Association, Reader's Digest Association, Inc., Mail Order Association of America, United Parcel Service of America, Inc., National Association of Greeting Card Publishers, International Labor Press Association,/CLC, Direct Mail/Marketing Association, Inc., Warshawsky & Company, Magazine Publishers Association, Inc., Classroom Publishers Association, American Business Press, Inc., American Lung Association, National Easter Seal Society, St. Jude Children's Research Hospital, American Cancer Society, National Wildlife Federation, Intervenors. ockets 81-4035, 81-4037, 81-4047 and 81-4075. |
| Court | U.S. Court of Appeals — Second Circuit |
John M. Burzio, Hydeman, Mason, Burzio & Lloyd, Washington, D. C., for petitioners/intervenors Newsweek, Inc., Time Inc. and Magazine Publishers Ass'n, Inc.; Diana M. Daniels, New York City, Toni G. Allen, Jay A. Resnick, Wald, Harkrader & Ross, Washington, D. C., of counsel, for petitioner/intervenor Newsweek, Inc.; Charles M. Waygood, Olwine, Connelly, Chase, O'Donnell & Weyher, New York City, Justin R. Wolf, Louise C. Powell, Washington, D. C., of counsel, for petitioner/intervenor Time Inc.; John M. Hadlock, Whitman & Ransom, New York City, David Minton, Loomis, Owen, Fellman & Howe, Washington, D. C., of counsel, for petitioner/intervenor Magazine Publishers Ass'n, Inc.
Robert L. Kendall, Jr., Philadelphia, Pa. (Irving R. Segal, John E. McKeever, Schnader, Harrison, Segal & Lewis, Philadelphia, Pa., of counsel), for petitioner/intervenor United Parcel Service of America, Inc.
Richard J. Webber, Washington, D. C. (Matthew S. Perlman, Arent, Fox, Kintner, Plotkin & Kahn, Washington, D. C., John T. Kerrigan, Howie & Robertson, New York City, of counsel), for intervenor National Ass'n of Greeting Card Publishers.
Timothy J. May, Patton, Boggs & Blow, Washington, D. C., for petitioner Council of Public Utility Mailers, petitioner/intervenor Reader's Digest Ass'n, Inc. and intervenors Mail Order Ass'n of America and Parcel Shippers Ass'n; Peter V. K. Funk, Jr., Gould & Wilkie, New York City, Eugene E. Threadgill, Connole & O'Connell, Washington, D. C., of counsel, for petitioner Council of Public Utility Mailers; David C. Todd, Patton, Boggs & Blow, Washington, D. C., of counsel, for intervenor Mail Order Ass'n of America.
William J. Olson, Smiley, Murphy, Olson & Gilman, Washington, D. C. (Alan R. Swendiman, Jackson, Campbell, & Parkinson, Washington, D. C., of counsel), for intervenors March of Dimes, American Lung Ass'n, National Easter Seal Society, St. Jude Children's Research Hospital, American Cancer Society and National Wildlife Federation.
Dana T. Ackerly, Washington, D. C. (David K. Flynn, Covington & Burling, Washington, D. C., of counsel), for intervenor Direct Mail/Marketing Ass'n, Inc.
Raymond N. Shibley, Washington, D. C. (M. Reamy Ancarrow, LeBoeuf, Lamb, Leiby & MacRae, Washington, D. C., W. Gilbert Faulk, Jr., Princeton, N. J., of counsel), for intervenor Dow Jones & Co., Inc.
Charles Emmet Lucey, Gary L. Ryan, McDermott, Will & Emery, Washington, D. C., of counsel, for intervenors Warshawsky & Co. and International Labor Press Ass'n, AFL-CIO/CLC.
Frances G. Beck, Asst. Gen. Counsel, U. S. Postal Service, Washington, D. C. (Louis A. Cox, Gen. Counsel, Susan M. Duchek, Daniel J. Foucheaux, Jr., Eric P. Koetting, Gerald J. Robinson, U. S. Postal Service, Washington, D. C., of counsel), for respondent, United States Postal Service.
Before MESKILL and KEARSE, Circuit Judges, and COFFRIN, District Judge. *
These consolidated cases arise from an order of the Board of Governors of the United States Postal Service which allowed, under protest, certain changes in postal rates and fees to take effect pursuant to the rate-making provisions of the Postal Reorganization Act of 1970, 39 U.S.C. § 101 et seq. (1976) ("Act").
Collectively, the petitioners and intervenors in this case attack the order of the Postal Board of Governors on a broad front. The principal issue presented for review is whether the resulting changes in rates and fees are lawful. To that end, two major challenges are presented. Several parties argue that the rates are unlawful because they are based upon an incorrect interpretation of 39 U.S.C. § 3622(b) that was foisted upon the postal system by the United States Court of Appeals for the District of Columbia Circuit. 1 Other parties contend that the D.C. Circuit's interpretation is correct, but argue that the Service-Related Cost ("SRC") concept, which was used to allocate various costs in setting the current rates, is irrational and that the rates are accordingly unlawful. The respondent Postal Service, while it defends its decision to allow the changes to take effect under protest as legal and proper, also aligns itself with the petitioners to the extent that it contests the D.C. Circuit's interpretation of section 3622(b) and rejects the SRC concept. These issues are treated first in this opinion.
An additional issue of primary importance raised on this appeal concerns the Postal Service's general revenue requirements. This issue is reviewed second. Finally, a plethora of issues concerning much narrower disputes is reviewed.
An appropriate resolution of the esoteric issues presented in this case requires a general understanding of the postal system's organization and rate-making structure which will therefore be discussed first.
The postal system is comprised of two independent executive agencies, the United States Postal Service, see 39 U.S.C. § 201, which is governed by a Board of Governors ("Board"), see 39 U.S.C. § 202, and a Postal Rate Commission ("PRC"), see 39 U.S.C. § 3601.
The issues in this case arise from a rate-making proceeding, yet also touch upon certain tensions that exist within the structure of the postal system, specifically between the Board and the PRC.
The rate-making process in the postal system is unique. While the Board is entrusted with the power "to establish ... reasonable and equitable rates of postage and fees for postal services," see 39 U.S.C. § 3621, its actual rate-making authority, with a few exceptions, is limited to approving, rejecting, modifying, or allowing under protest recommendations of the PRC, see 39 U.S.C. § 3625(a). The PRC, however, may not initiate a rate proceeding on its own. Rather, pursuant to section 3622(a), the PRC must await a "request" from the Board
to submit a recommended decision on changes in a rate or rates of postage or in a fee or fees for postal services if the Postal Service (Board) determines that Section 3622(b) provides that upon receiving such a request from the Board, the PRC "shall make a recommended decision on the request for changes in rates or fees in each class of mail or type of service in accordance with the policies of this title and (certain) factors." For convenience, the individual factors are omitted at this point, but will be discussed in detail below.
such changes would be in the public interest and in accordance with the policies (of the Act). 2
Once the PRC responds with its recommended decision, the Board has several options. Section 3625(a) provides that "the Governors may approve, allow under protest, reject, or modify that decision in accordance with the provisions of this section."
As a prerequisite to modification, the Board must first reject the PRC's recommended decision and "resubmit" it to the PRC for further consideration. 39 U.S.C. § 3625(d). Then, upon receiving the PRC's decision following reconsideration, the Board, only if it is unanimous, may modify the decision. Id.
Finally, if pursuant to section 3625(c) the Board "under protest, allow(s) a recommended decision to take effect," it must either seek judicial review of the PRC's decision, or return the decision to the PRC for reconsideration and a further recommended decision.
In the case before us, the Board opted for subdivision (c), placing the PRC's recommended decision into effect under protest, and returning the decision to the PRC for further consideration.
The Board's decision to allow under protest and return the decision to the PRC constituted a final order subject to judicial review upon the appeal of an "aggrieved party." 39 U.S.C. § 3628. Section 3628 provides that a decision of the Board may be appealed to any circuit court of appeals in the United States and further provides that the circuit court
may affirm the decision or order that the entire matter be returned for further consideration, but the court may not modify the decision. The court shall make the matter a preferred cause and shall expedite judgment in every way. The court may not suspend the effectiveness of the changes, or otherwise prevent them...
To continue reading
Request your trial
-
Friedlander v. US Postal Service
...intended "to vest in the Board of Governors exclusive authority to manage the Postal Service"); accord Newsweek, Inc. v. United States Postal Service, 663 F.2d 1186, 1203 (2d Cir.1981), aff'd, 462 U.S. 810, 103 S.Ct. 2717, 77 L.Ed.2d 195 (1983). Since the President is responsible for appoin......
- U.S. v. Walsh
-
U.S. v. Carson
...well settled that the decisions of one circuit court of appeals are not binding upon another circuit. Newsweek, Inc. v. United States Postal Service, 663 F.2d 1186, 1196 (2d Cir.1981), affirmed, 462 U.S. 810, 103 S.Ct. 2717, 77 L.Ed.2d 195 (1983). While we often rely upon the analysis and d......
-
Mail Order Ass'n of America v. U.S. Postal Service
...Sec. 3624(a). The record of such hearings must provide the basis for the Commission's recommended decision. See Newsweek, Inc. v. USPS, 663 F.2d 1186, 1205 (2d Cir.1981) (remanding a PRC recommended decision that was based on a methodology that was not introduced in the hearings or subjecte......
-
Going postal: regulatory reform for the digital age.
...to fashion policies of the Postal Service without interference, including from the PRC" (Newsweek, Inc. v. United States Postal Service, 663 F.2d 1186, 1205-06 [2d Cir. 1981]). Congress plainly intended that the Postal Service would operate as a sovereign central planner and that the Postal......