Air Courier Conference of America/International Committee v. U.S. Postal Service

Citation959 F.2d 1213
Decision Date13 March 1992
Docket NumberNo. 91-3216,91-3216
PartiesAIR COURIER CONFERENCE OF AMERICA/INTERNATIONAL COMMITTEE, International Express Carriers Conference, DHL Airways, Inc., Dworkin-Cosell Interair Courier Services, Inc., Federal Express Corporation, Intertrade Courier International, Inc., TNT Skypak, Inc., and UPS Air Forwarding, Inc. v. U.S. POSTAL SERVICE Air Courier Conference of America/International Committee, an Unincorporated Association, Appellant.
CourtU.S. Court of Appeals — Third Circuit

John E. McKeever, Robert L. Kendall, Jr. (argued), Schnader, Harrison, Segal & Lewis, Philadelphia, Pa., for appellant.

Harold J. Hughes, Gen. Counsel, John L. DeWeerdt, Associate Gen. Counsel, William T. Alvis (argued), International Law Counsel, Eric P. Koetting, U.S. Postal Service, Washington, D.C., for appellee.

Before: BECKER and HUTCHINSON, Circuit Judges, and FULLAM, District Judge *.

OPINION OF THE COURT

HUTCHINSON, Circuit Judge.

Air Courier Conference of America/International Committee (Air Courier) appeals a judgment upholding appellee United States Postal Service's (Postal Service's) rate reduction on one class of On-Demand Express Mail International Service. Air Courier argues that the Postal Reorganization Act (Act) requires the Postal Rate Commission (Commission) to review international mail rates. We think the text of the Act, read as a whole in light of its purpose and history, indicates otherwise. Our conclusion that the Act does not involve the Commission in establishing international rates is also supported both by the Postal Service's and the Commission's longstanding interpretation of the Act to that effect. We will therefore affirm the judgment of the district court.

I.

Air Courier, a trade association composed of companies providing domestic and international expedited letter and parcel delivery service, along with another trade association and six individual international carriers 1 (collectively "plaintiffs"), filed a two-count complaint against the Postal Service in the United States District Court for the District of Delaware. Count one alleged that a permanent rate reduction for On-Demand Express Mail International Service from $18.00 per piece to $10.75 per piece for items weighing up to eight ounces was illegal because the Postal Service adopted the $10.75 rate without first submitting it to the Commission in accord with 39 U.S.C.A. § 3622 (West 1980). Count two alleged that the new rate of $10.75 for each item weighing eight ounces or less was a predatory price set below the Postal Service's cost of providing the service in violation of 39 U.S.C.A. §§ 101(d), 403(a), 403(c) (West 1980). The plaintiffs sought a permanent injunction prohibiting the Postal Service from using the $10.75 rate for On-Demand Express Mail International Service before review by the Commission or from operating that service at less than a reasonable rate.

Pursuant to Federal Rule of Civil Procedure 12(b)(6), the Postal Service moved to dismiss count one for failure to state a claim upon which relief could be granted. It argued that 39 U.S.C.A. § 407(a) (West 1980) gives it power to establish international postage rates without Commission review. The plaintiffs opposed the motion to dismiss count one and filed a cross-motion for summary judgment. After briefing, the district court granted the Postal Service's motion to dismiss count one and denied plaintiffs' motion for summary judgment on that count. See Air Courier Conference of Am./Int'l Comm. v. United States Postal Serv., 762 F.Supp. 86, 92 (D.Del.1991). In its ruling in favor of the Postal Service, the district court deferred to the Postal Service's and the Commission's longstanding identical constructions of the Act holding the construction that gave the Postal Service unilateral authority to establish rates for international service was reasonable and not contrary to Congress's legislative intent.

Discovery on the plaintiffs' count two theory of predatory pricing in violation of sections 101(d), 403(a) and 403(d) followed. After the Postal Service raised the disputed rate on February 3, 1991, Air Courier and the other plaintiffs voluntarily dismissed count two. The district court then entered final judgment on count one. From that judgment Air Courier alone filed a timely notice of appeal.

We will affirm the order of the district court. Reading the Act as a whole, we think Congress's intent to place the power to "establish" rates for international mail in the Postal Service is reasonably plain from the statutory text. The legislative history of the relevant statutory provisions is ambiguous and certainly insufficient to alter our interpretation of the statutory text. Air Courier's reliance on cases, including our own, that deny the Postal Service unilateral power over domestic mail rates is misplaced because the statute treats domestic and international ratemaking differently. Finally, our decision is buttressed by the Postal Service's longstanding reasonable construction of the Act as giving it power to "establish" international rates--a construction the Commission concurs in. Our detailed reasoning follows.

II.

The Postal Service is "an independent establishment of the executive branch of the Government of the United States." 39 U.S.C.A. § 201 (West 1980). Its duties, as set forth by Congress, are to:

plan, develop, promote, and provide adequate and efficient postal services at fair and reasonable rates and fees. The Postal Service shall receive, transmit, and deliver throughout the United States, its territories and possessions, and, pursuant to arrangements entered into under sections 406 and 411 of this title, throughout the world, written and printed matter, parcels, and like materials and provide such other services incidental thereto as it finds appropriate to its functions and in the public interest. The Postal Service shall serve as nearly as practicable the entire population of the United States.

Id. § 403(a). The Postal Service is also charged with the efficient collection, sorting and delivery of mail to meet the needs of all types of mail users, as well as the duty to maintain accessible postal facilities. Id. § 403(b) (West 1980). Except as otherwise provided, the Postal Service is to do all this without "undue or unreasonable discrimination among users of the mails [or] undue or unreasonable preferences to any such user." Id. § 403(c).

Before the Act was adopted in 1970, the burden of setting domestic postal rates fell on Congress. See H.R.Rep. No. 1104, 91st Cong., 2d Sess. 5, reprinted in 1970 U.S.C.C.A.N. 3649, 3654; United Parcel Serv., Inc. v. United States Postal Serv., 604 F.2d 1370, 1374 (3d Cir.1979), cert. denied, 446 U.S. 957, 100 S.Ct. 2929, 64 L.Ed.2d 815 (1980). Congress had not, however, then involved itself in setting international rates. It left that task to the Postmaster General. 39 U.S.C.A. App. § 505(a) (West 1980).

The Act drastically changed the way domestic postal rates are established. Under it, domestic rate changes are first proposed by the Postal Service. 39 U.S.C.A. § 3622(a). The Postal Service submits its rate proposals to the Commission, id., a five-member body appointed by the President with the advice and consent of the Senate, id. § 3601(a) (West 1980). After hearings, see id. § 3624(a) (West 1980), the Commission transmits a recommended decision to the nine Governors of the Postal Service (Governors), id. § 3624(d) (West 1980). The Governors of the Postal Service are also appointed by the President with the advice and consent of the Senate. Id. § 202(a) (West Supp.1991). They, along with the Postmaster General and the Deputy Postmaster General, make up the Board of Governors of the Postal Service. The Board's task is to direct "[t]he exercise of the power of the Postal Service." Id.; id. § 202(c) & (d) (West 1980). The Postmaster General and his deputy, through members of the Board of Governors, take no part in the ultimate act of establishing rates. They are not among those to whom the Commission makes recommendations on rates the Postal Service proposes. Instead, the power to act on the Commission's recommendation is reserved to the nine Governors the President appoints with the advice and consent of the Senate pursuant to section 202(a) of the Act.

The Governors have several options with respect to the Commission's recommended decision. They may approve the Commission's recommendation, modify it, reject it or allow it to take effect under protest. Id. § 3625(a) (West 1980). If they reject the recommendation, the Postal Service "may resubmit its request to the Commission for reconsideration." Id. § 3625(d) (West 1980). If the Governors allow a recommended decision to take effect under protest, they may, nevertheless, ask the Commission to reconsider its decision or, alternately, seek judicial review. Id. § 3625(c) (West 1980). If they ask the Commission to reconsider, the Governors can modify the Commission's reconsidered recommendation only if they unanimously decide that it "is in accord with the record and the policies of" the rate-setting chapter of the Act, chapter thirty-six, and that the recommended rates are necessary to provide the Postal Service with total revenues sufficient to cover total costs. Id. § 3625(d). Air Courier has contended throughout this case that the Act requires the Postal Service to follow this procedure in setting international rates.

In 1970, the Postal Service introduced Express Mail Service for domestic deliveries. Later it extended Express Mail Service to almost 100 foreign countries. It now provides International Express Mail Service in a manner consistent with the Acts of the Universal Postal Union, a body created by international agreement among sovereign states.

Effective December 13, 1987, the Postal Service announced a new rate for Express Mail International Service for pieces weighing one-half...

To continue reading

Request your trial
23 cases
  • Pennsylvania v. DeJoy
    • United States
    • U.S. District Court — Eastern District of Pennsylvania
    • 25 Agosto 2021
    ...determine whether the Postal Service exceeded its authority in violation of PRA § 403(b) ); Air Courier Conf. of Am./Int'l Comm. v. U.S. Postal Serv. , 959 F.2d 1213, 1214, 1217 n.2 (3d Cir. 1992) (observing that the Court had jurisdiction under 28 U.S.C. § 1339 and section 409(a) to determ......
  • NYLife Distributors, Inc. v. Adherence Group, Inc.
    • United States
    • U.S. Court of Appeals — Third Circuit
    • 2 Febrero 1996
    ... ... history that are relevant to the issues before us ...         On February 15, 1994, ... Sec. 2361 (1994) provides for nationwide service on all claimants in statutory interpleader ... See Air Courier Conference of Am./Int'l Comm. v. United States ... ...
  • Conoco, Inc. v. Skinner
    • United States
    • U.S. Court of Appeals — Third Circuit
    • 18 Agosto 1992
    ... ... U.S. Customs Service ... Nos. 91-3589, 91-3920 ... United States ... a protective petition in this court asking us to review the Maritime Administration regulation ... with plain language of statute); Air Courier Conference of America/Int'l Comm. v. United s Postal Serv., 959 F.2d 1213, 1224 (3d Cir.1992) ... The Commerce Committee takes it for granted that every patriotic citizen ... ...
  • Aarp v. E.E.O.C.
    • United States
    • U.S. District Court — Eastern District of Pennsylvania
    • 27 Septiembre 2005
    ...their own statutory authority may in fact be entitled to deference in some circumstances. See Air Courier Conference of Am./Int'l Comm. v. U.S. Postal Serv., 959 F.2d 1213, 1223 (3d Cir.1992); Puerto Rico Maritime Shipping Auth. v. Valley Freight Systems, Inc., 856 F.2d 546, 552 (3d Cir.198......
  • Request a trial to view additional results
1 books & journal articles
  • Beyond Chevron's Domain: Agency Interpretations of Statutory Procedural Provisions
    • United States
    • Seattle University School of Law Seattle University Law Review No. 30-03, March 2007
    • Invalid date
    ...(applying Chevron deference after discussion about jurisdictional issue); Air Courier Conference of Am./Int'l Comm. v. U.S. Postal Serv., 959 F.2d 1213, 1223-25 (3d Cir. 1992) (granting Chevron deference after discussing petitioner's argument that deference was inappropriate in light of the......

VLEX uses login cookies to provide you with a better browsing experience. If you click on 'Accept' or continue browsing this site we consider that you accept our cookie policy. ACCEPT