Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-caed-2_05-cv-02124/USCOURTS-caed-2_05-cv-02124-0/pdf.json

Nature of Suit Code: 890
Nature of Suit: Other Statutory Actions
Cause of Action: 39:409 Postal Service

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IN THE UNITED STATES DISTRICT COURT

FOR THE EASTERN DISTRICT OF CALIFORNIA

ALLIANCE FOR A BETTER CALIFORNIA, ) 02:05-cv-2124-GEB-DAD

)

 Plaintiff, )

)

v. ) ORDER

)

UNITED STATES POSTAL SERVICE; JOE )

G. ZAPATA, United States )

Postmaster for the Santa Ana Main )

Office; THE CALIFORNIA RECOVERY )

TEAM; GOVERNOR SCHWARZENEGGER’S )

CALIFORNIA RECOVERY TEAM; DOES )

1-5, et al., ) 

)

 Defendants. )

)

On October 25, 2005, Plaintiff filed an Ex Parte Application

for a Temporary Restraining Order (“Application”). A Minute Order

issued on October 26, 2005, scheduling the Application for hearing on

October 27, 2005, and stating that any oppositions should be filed by

4:30 p.m. October 26, 2005. Defendants filed their respective

oppositions on October 26 and 27, 2005. The Application was argued on

October 27, 2005.

Plaintiff argues that a temporary restraining order (“TRO”)

must issue “to prevent the ongoing misuse of a United States nonprofit

mail permit by a political committee in the final [days] before the 

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1 Plaintiff also argued that CRT has inappropriately used its

NSM rate to send political advocacy mail on behalf of Governor

Schwarzenegger’s California Recovery Team (“GSCRT”); however, the

parties state that CRT and GSCRT are the same entity. (Pl.’s Memo. at

2; Def. CRT/GSCRT Am. Prelim. Opp’n to Application for TRO and Prelim.

Inj. (“CRT Opp’n”) at 18.) 

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November 8, 2005 special statewide election.” (Memo. of P. & A. in

Supp. of Pl.’s Ex Parte Application for TRO and Order to Show Cause re

Prelim. Inj. (“Pl.’s Memo.”) at 1.) Plaintiff and Defendant

California Recovery Team (“CRT”) are on opposite sides of a ballot

initiative campaign concerning whether voters should approve

Proposition 75, an initiative measure appearing on the November 8,

2005, special election ballot. 

Plaintiff argues CRT has an unfair advantage in its campaign

in support of Proposition 75 because it is inappropriately using the

Nonprofit Standard Mail rate (“NSM rate”) to send political advocacy

materials.1 (Pl.’s Memo. at 1-2.) Plaintiff asserts that this usage

allows CRT to send mailings for approximately forty percent less than

Plaintiff, which allows CRT to save “approximately $.07 per piece of

mail.” (Id. at 12.) Plaintiff calculates that utilization of the NSM

rate will allow CRT to save “almost $700,000,” which could be used for

additional political advocacy. (Id.; Kaufman Decl. ¶¶ 10, 13, Ex. R.) 

Plaintiff contends that the effect of this savings is that the

government is inappropriately subsidizing CRT’s position on

Proposition 75. (Pl.’s Memo. at 12.)

CRT applied to the United States Postal Service (“USPS”) for

the NSM rate based on its status as a “philanthropic social welfare

organization” under Domestic Mail Manual 703.1.2.6. (CRT Opp’n at

10.) In September 2004, the USPS granted CRT’s application. (Id.) 

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Plaintiff contends that CRT is not eligible for the NSM rate under

section 703.1.2.6 of the USPS regulations because it is not a

“qualified nonprofit organization as required by section 1.2.” (Pl.’s

Memo. at 7-9.) Plaintiff argues that the regulations require CRT’s

“primary purpose” to be philanthropic, but that CRT’s primary purpose

is political advocacy. (Id.) Plaintiff argued at the October 27

hearing that because CRT is actually a political organization, like

Plaintiff, a TRO should issue preventing CRT from benefitting from its

inappropriate use of the NSM rate.

Specifically, Plaintiff argued a TRO should issue because

CRT should have never been authorized by USPS to mail at the NSM rate,

and alternatively, the USPS should have revoked CRT’s authorization

because it has become obvious that CRT is using the NSM rate primarily

for political advocacy activities. (Id. at 7-11.) At the October 27

hearing, Plaintiff limited the scope of relief requested, arguing that

a TRO should issue suspending CRT’s eligibility for the NSM rate from

the moment of the TRO’s issuance to the day of the election. USPS

opposed the issuance of a TRO, arguing that USPS has begun an

administrative proceeding regarding CRT’s eligibility to use the NSM

rate, which was “triggered” by Plaintiff’s “complaints to the post

office.” (Oct. 27, 2005 Hr’g.) USPS recognized that no decision

would be made by the USPS before the special election, but

nevertheless “urge[d] the Court to let the administrative proceedings

take its course.” (Id.) Plaintiff rejoined that the administrative

review is inadequate because the special election is imminent and

ballots will have been cast before USPS makes a decision. (Id.) 

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Plaintiff argues that “[t]his Court has jurisdiction to

order the Postal Service to enforce its own regulations,” relying on

the Ninth Circuit decision in Owen v. Mulligan, 640 F.2d 1130 (9th

Cir. 1981). (Pl.’s Memo. at 10.) At the October 27 hearing,

Plaintiff appeared to indicate that the rationale of Owen would also

authorize the issuance of the limited TRO that was requested during

the hearing. Owen concerned “a suit in mandamus to require the Postal

Service to meet its statutory duty.” Siebert v. Conservative Party of

New York State, 724 F.2d 334, 338 (2d Cir. 1983). USPS argues that

Owen is inapplicable because USPS is in the process of meeting its

statutory duty; specifically, it has initiated an administrative

proceeding to determine CRT’s eligibility for the NSM rate. (United

States’s Opp’n to Ex Parte Mot. for TRO at 5.) USPS notes that postal

regulations do not contemplate revocation of CRT’s NSM eligibility

during the pendency of the administrative proceedings, “but on the

contrary . . . [allow] termination only after notice and an

opportunity to be heard.” (Id. at 4-5.) Consequently, Plaintiff’s

reliance on Owen is misplaced because Plaintiff seeks a TRO that would

compel USPS to act contrary to its regulations.

Therefore, the question is whether the Court has

jurisdiction to compel USPS to act contrary to its established

regulations or to issue a TRO that would achieve that same effect. 

Plaintiff’s Complaint asserts that subject matter jurisdiction is

proper under 28 U.S.C. § 1339 and 39 U.S.C. § 409(a). (Pl.’s Verified

Compl. for Injunctive Relief at 2.) Under § 1339, federal district

courts have original jurisdiction over any civil action arising under

any Act of Congress relating to the Postal Service; under § 409(a),

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federal district courts have original but not exclusive jurisdiction

over all actions brought by or against the Postal Service. “However,

these statutes do not by themselves create a cause of action, but

merely give . . . [the Court] jurisdiction over an otherwise existing

cause of action.” People Gas, Light & Coke Co. v. United States

Postal Service, 658 F.2d 1182, 1189 (7th Cir. 1981)(28 U.S.C. § 1339

and 39 U.S.C. § 409(a) do not provide a cause of action); Currier v.

Potter, 379 F.3d 716 (9th Cir. 2004) (39 U.S.C. § 409(a) does not

provide a cause of action). Consequently, to each of these provisions

there must be added a “substantive legal framework of federal law to

confer subject matter jurisdiction.” Currier, 379 F.3d at 725; People

Gas, 658 F.2d at 1189. Therefore, the regulations at issue must

explicitly or implicitly provide Plaintiff a cause of action,

otherwise no subject matter jurisdiction exists. See Currier, 379

F.3d at 725. 

Upon inspection, it is apparent that Domestic Mail Manual

703.1 does not provide Plaintiff with an express cause of action

against the USPS; thus, subject matter jurisdiction exists only if the

regulation implies a cause of action. When determining whether an

implied cause of action exists, several factors are relevant: 

‘First, is the plaintiff one of the class for

whose especial benefit the statute was

enacted . . . ? Second, is there any indication of

legislative intent, explicit or implicit, either

to create such a remedy or to deny one? Third, is

it consistent with the underlying purposes of the

legislative scheme to imply such a remedy for the

plaintiff? And finally, is the cause of action one

traditionally relegated to state law . . . ?’

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Currier, 379 F.3d at 725 (quoting Cort v. Ash, 422 U.S. 66 (1975)). 

Of these factors, the Ninth Circuit has emphasized that “the second

and third are determinative.” Id.

In Currier, the Ninth Circuit examined whether the

plaintiffs had an implied cause of action under Domestic Mail Manual

910.5.1(a). Id. at 723 n.4. The Ninth Circuit stated “[w]e are not

persuaded that Congress, by enacting the [Postal Reorganization Act],

intended to subject the Postal Service to suit for violations of

regulations . . . We are satisfied that the [Postal Reorganization

Act] evinces Congress’[s] general intent to withdraw judicial scrutiny

of postal regulations.” Id. at 724-25. In light of Congress’s

intent, the Ninth Circuit held that “the second and third factors

militate against our inferring a private right of action.” Id.

Similarly, Plaintiff has alleged the violation of a Domestic Mail

Manual regulation that was issued pursuant to certain sections of the

Postal Reorganization Act. See 39 U.S.C. § 3626(a). Accordingly, in

light of the Ninth Circuit’s analysis, the second and third factors

also militate against inferring a private right of action under

Domestic Mail Manual 703.1.

The Court is not unsympathetic to Plaintiff’s plight. 

Plaintiff has presented evidence which raises serious questions about

the propriety of CRT’s continued use of the NSM rate. Plaintiff will

likely suffer some harm in the hotly contested special election if

CRT’s use of the NSM rate is in fact inappropriate. Although

Plaintiff may be wronged by the acts of Defendants, Congress has not

provided Plaintiff with the remedy it seeks. See Seibert, 724 F.2d at

337 (“where Congress felt a need for private remedies under the postal

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laws it . . . expressly provided for them”). Therefore, Plaintiff’s

application for a TRO is denied because the Court lacks subject matter

jurisdiction. 

IT IS SO ORDERED.

Dated: November 1, 2005

/s/ Garland E. Burrell, Jr.

GARLAND E. BURRELL, JR.

United States District Judge

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