Federal Register / Vol. 74, No. 134 / Wednesday, July 15, 2009 / Notices 34373 

The press and public may enter the 

NTSB Conference Center one hour prior 

to the meeting for set up and seating. 

Individuals requesting specific 

accommodations should contact 

Rochelle Hall at (202) 314–6305 by 

Friday, July 24, 2009. 

The public may view the meeting via 

a live or archived Web cast by accessing 

a link under ‘‘News & Events’’ on the 

NTSB home page at http:// 

www.ntsb.gov. 

FOR MORE INFORMATION CONTACT: Vicky 

D’Onofrio, (202) 314–6410. 

Dated: Friday, July 10, 2009. 

Vicky D’Onofrio, 

Federal Register Liaison Officer. 

[FR Doc. E9–16864 Filed 7–13–09; 11:15 am] 

BILLING CODE 7533–01–P 

NUCLEAR REGULATORY 

COMMISSION 

Sunshine Federal Register Notice 

AGENCY HOLDING THE MEETINGS: Nuclear 

Regulatory Commission. 

DATES: Weeks of July 13, 20, 27, August 

3, 10, 17, 2009. 

PLACE: Commissioners’ Conference 

Room, 11555 Rockville Pike, Rockville, 

Maryland. 

STATUS: Public and Closed. 

Week of July 13, 2009 

There are no meetings scheduled for 

the week of July 13, 2009. 

Week of July 20, 2009—Tentative 

There are no meetings scheduled for 

the week of July 20, 2009. 

Week of July 27, 2009—Tentative 

There are no meetings scheduled for 

the week of July 27, 2009. 

Week of August 3, 2009—Tentative 

There are no meetings scheduled for 

the week of August 3, 2009. 

Week of August 10, 2009—Tentative 

There are no meetings scheduled for 

the week of August 10, 2009. 

Week of August 17, 2009—Tentative 

There are no meetings scheduled for 

the week of August 17, 2009. 

* * * * * 

* The schedule for Commission 

meetings is subject to change on short 

notice. To verify the status of meetings, 

call (recording)—(301) 415–1292. 

Contact person for more information: 

Rochelle Bavol, (301) 415–1651. 

* * * * * 

The NRC Commission Meeting 

Schedule can be found on the Internet 

at: http://www.nrc.gov/about-nrc/policymaking/schedule.html. 

* * * * * 

The NRC provides reasonable 

accommodation to individuals with 

disabilities where appropriate. If you 

need a reasonable accommodation to 

participate in these public meetings, or 

need this meeting notice or the 

transcript or other information from the 

public meetings in another format (e.g. 

braille, large print), please notify the 

NRC’s Disability Program Coordinator, 

Rohn Brown, at 301–492–2279, TDD: 

301–415–2100, or by e-mail at 

rohn.brown@nrc.gov. Determinations on 

requests for reasonable accommodation 

will be made on a case-by-case basis. 

* * * * * 

This notice is distributed 

electronically to subscribers. If you no 

longer wish to receive it, or would like 

to be added to the distribution, please 

contact the Office of the Secretary, 

Washington, DC 20555 (301–415–1969), 

or send an e-mail to 

darlene.wright@nrc.gov. 

Dated: July 9, 2009. 

Rochelle C. Bavol, 

Office of the Secretary. 

[FR Doc. E9–16912 Filed 7–13–09; 4:15 pm] 

BILLING CODE 7590–01–P 

POSTAL REGULATORY COMMISSION 

[Docket No. C2009–1; Order No. 235] 

Complaint of GameFly, Inc. 

AGENCY: Postal Regulatory Commission. 

ACTION: Notice. 

SUMMARY: The Commission has initiated 

a case to address allegations of undue 

discrimination and other issues raised 

by GameFly, Inc. (GameFly) in a formal 

complaint related to sending and 

receiving DVDs. Accepting the case will 

provide an opportunity for review of 

pertinent issues. 

DATES: 1. Joint prehearing conference 

memorandum is due July 20, 2009. 

2. Notices of intervention are due July 

22, 2009. 

3. A prehearing conference will be 

held July 23, 2009 (10 a.m.). 

ADDRESSES: Submit comments 

electronically via the Commission’s 

Filing Online system at http:// 

www.prc.gov. 

FOR FURTHER INFORMATION CONTACT: 

Stephen L. Sharfman, General Counsel, 

202–789–6820 and 

stephen.sharfman@prc.gov. 

SUPPLEMENTARY INFORMATION: The 

Complaint of GameFly, Inc. (Complaint) 

was filed on April 23, 2009. The 

Complaint asserts several claims that 

concern unreasonable discrimination 

and other undue preferences allowed by 

the United States Postal Service in 

violation of the law. In support of its 

Complaint, GameFly, Inc. (GameFly) 

alleges that the Postal Service extended 

preferential services and inequitable 

rates to certain high volume rival 

mailers who similarly use First-Class 

Mail to send and receive DVDs. 

GameFly specifically contends its 

pieces are being processed through the 

automated letter mail processing 

equipment that continues to cause 

damage, and that the favored high 

volume DVD mailers are not suffering 

the high level of broken DVDs. It further 

alleges that ever since it resorted to 

higher cost flat rates and inserts to 

reduce breakage, it is still suffering more 

damage than these other mailers, while 

it is also paying the additional ounce 

postage charges and more for the flats 

shape of its pieces. 

The Answer of the United States 

Postal Service (Answer) in response to 

the Complaint was filed on May 26, 

2009, together with a Motion of the 

United States Postal Service for Partial 

Dismissal of Complaint (Motion for 

Partial Dismissal). The Answer denied 

that the Postal Service’s updated policy 

favors special handling by hand for 

inbound pieces, even though some 

exceptions arise in the field. The Motion 

for Partial Dismissal asserts that 

GameFly’s reliance upon 39 U.S.C. 

404(b) for jurisdiction appears 

misplaced. On June 2, 2009, GameFly, 

under a Motion of GameFly, Inc. for 

Leave to File Reply to Requests of the 

USPS for Disposition of Complaint 

(Motion for Leave), filed a Reply of 

GameFly, Inc. to Requests of the USPS 

for Disposition of Complaint (Reply). 

For the reasons explained below, the 

Commission concludes it has 

jurisdiction over the dispute, grants 

GameFly’s Motion for Leave, and, upon 

a review of the pleadings, denies the 

Postal Service’s Motion for Partial 

Dismissal. The Commission also 

concludes that the Complaint raises 

material issues of fact and law, and shall 

begin proceedings to hear the issues 

involved. 39 U.S.C. 3662(b). 

I. The GameFly Complaint 

GameFly claims that the rates and 

services extended to some high volume 

DVD mailers violate 39 U.S.C. 101(d), 

403(c), 404(b) and 3622(b)(8), which 

prohibit undue discrimination. 

Complaint at 1. It explains that it, like 

many other businesses that rent DVDs to 

consumers, uses a two-way DVD mailer. 

Id. at 3. It distributes game DVDs to 


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34374 Federal Register / Vol. 74, No. 134 / Wednesday, July 15, 2009 / Notices 

1 Id. at 8–9. GameFly cites a report from 2007 that 

allegedly found that most of the two-way DVD 

mailpieces from one unnamed high volume DVD 

rental company received manual processing. See 

Complaint at 8, para. 36, citing USPS Office of 

Inspector General, Audit Report No. MS–AR–08– 

001, Review of Postal Service First-Class Permit 

Reply Mail (November 8, 2007) (OIG Report). 

2 Id. at 8; see also OIG Report at 5, n.9. The term 

‘‘culling’’ usually refers to removing, by hand, nonletter mail from letter mail, and non-machinable 

mailpieces from automation rate pieces. 

3The Postal Service’s Motion for Partial 

Dismissal, discussed below, does not separately 

challenge GameFly’s first two counts, raised under 

section 403(c), either based upon any defect of 

pleading or jurisdiction. 

4Count III asserts the rates are unfair because the 

Postal Service processes the same DVDs on lettersorting equipment, unless the mailer also pays 

second-ounce postage. Count IV asserts that they 

are unfair because the Postal Service fails to process 

the DVDs on flats-sorting equipment. 

subscribers via First-Class Mail, and 

subscribers usually return the DVDs to 

GameFly in prepaid mailers via FirstClass Mail Business Reply Mail (BRM). 

Id. 

The Complaint alleges that the DVD is 

small enough so that when it is mailed 

in a lightweight mailer, the combined 

mailpiece can qualify as a one-ounce 

letter. Id. at 4. However, when the DVDs 

were enclosed in lightweight mailers 

without protective inserts, the company 

experienced breakage of DVDs in the 

mail. Id. GameFly alleges that the 

‘‘breakage occurs during the processing 

of DVD mailers on Postal Service 

automated mail processing equipment’’ 

for letters. Id. at 5. To reduce breakage, 

GameFly began to insert cardboard 

protectors into its DVD mailers in 2002. 

Id. 

While reducing breakage, the 

protectors ‘‘increased the size and 

weight of the mailpieces * * * to * * * 

two-ounce flats.’’ Id. This raised 

GameFly’s postal rates for this higher 

total weight. Id. at 6. In 2007, the rising 

postal rates on flats led GameFly to test 

other mailpiece designs without a 

protector to reduce breakage at less cost, 

but these tests did not succeed. Id. The 

Postal Service also declined GameFly’s 

request to reduce rates as to the second 

ounce. Id. at 7. 

GameFly contends that ‘‘the Postal 

Service failed to stop breaking GameFly 

DVDs’’ despite charging the higher rates 

for flats. Id. at 5. On account of the 

higher postage for flats, surcharges for 

the extra ounce, and certain other losses 

for theft, GameFly claims that it has 

incurred ‘‘greatly increased mailing 

costs,’’ that on average are almost 88 

cents per piece more than the postage 

for a one-ounce letter. Id. at 6–7. 

GameFly alleges that the Postal 

Service gave preferential treatment for 

certain high volume movie DVD mailers 

who also faced significant DVD 

breakage.1 It claims that ‘‘the Postal 

Service has adopted a practice of 

manually culling out the DVD mailers of 

two high volume shippers of DVDs, 

Netflix and Blockbuster, for special 

processing.’’ 2

GameFly asserts that the Postal 

Service’s practice of giving manual 

processing to DVDs from certain high 

volume mailers has continued since the 

OIG Report. Complaint at 9. It alleges 

that, despite its requests, the Postal 

Service has declined to give GameFly’s 

DVD mailers processing on terms and 

conditions comparable to those offered 

to the two high volume mailers. Id. It 

alleges that Blockbuster is a rival that is 

entering the market for game DVD 

mailpieces. Id. 

Counts I and II assert undue 

discrimination under sections 3662(a) 

and 403(c).3 Under counts III and IV, 

GameFly contests postal rates charged 

for DVDs entered by GameFly as FirstClass flats as inequitable, in violation of 

39 U.S.C. 404(b).4 Each of the counts 

includes the first 39 paragraphs of the 

Complaint. GameFly requests relief, 

following a hearing, in an order that 

prescribes the same rates and terms of 

service that the Postal Service provides 

to Netflix and Blockbuster. Id. at 13. 

II. The Postal Service’s Answer and 

Motion for Partial Dismissal 

The Postal Service responds to the 

Complaint with a timely answer, which 

denies most of the material allegations 

directly, and adds certain affirmative 

allegations. The Postal Service also 

denies any preferential practices of 

unfair rules, inequitable rates, or 

processing standards, as well as any 

liability, losses, causation, and injury. 

See, e.g., Answer at paras. 2, 12, 16, and 

19. It separately submits a Motion for 

Partial Dismissal to assert that the 

Commission lacks jurisdiction to hear 

counts that assert violations of 39 U.S.C. 

404(b). Motion for Partial Dismissal at 1. 

Aside from its Motion for Partial 

Dismissal, addressed below, the Postal 

Service alleges that it does not have a 

‘‘policy’’ of manually processing mail 

entered by other high volume DVD 

mailers for delivery to or from its 

customers. Answer at para. 49. The 

Postal Service explains that while it has 

no current practice of manually culling 

incoming DVDs, it admits that ‘‘some 

culling of the incoming DVDs (returns 

from customers) may * * * occur 

despite the change in policy.’’ Id. at 

para. 37. It also denies that ‘‘any 

significant volume of outgoing DVD 

mail pieces (from the mailer to the 

customer) are processed manually.’’ Id.; 

see also para. 38. 

The Postal Service urges that its 

procedures for letter sorting streams and 

flat sorting streams are justifiably 

different. Id. at para. 39. It asserts that 

mailpieces very close to the size of the 

envelopes that complainant currently 

uses would typically not be extracted as 

a flat. Id. at para. 22. It explains that 

each mailer’s mailpiece design controls 

the processing of the mailpiece. See, 

e.g., Answer at paras. 12, 17, 23. 

The Motion for Partial Dismissal 

explains that the Commission’s 

jurisdiction to hear complaints is 

‘‘narrowly specified’’ in a quoted 

portion of 39 U.S.C. 3662(a). The Postal 

Service mainly assails paragraphs 53 

and 55 of the Complaint. It observes that 

the Complaint improperly alleges that 

the Postal Service practices have 

violated 39 U.S.C. 404(b). Motion for 

Partial Dismissal at 2. The Postal 

Service submits that ‘‘subsection 

[404(b)] is not one of the specific 

provisions * * * that are identified in 

subsection 3662(a).’’ Id. Nor is the cited 

statute in chapter 36. Id. On these 

grounds, it contends that a ‘‘complaint 

filed under subsection 3662(a) alleging 

a violation of subsection 404(b) fails to 

state a cause of action for which the 

Commission may grant relief.’’ Id. 

III. Commission Analysis 

The Postal Service’s Motion for Partial 

Dismissal aims at eliminating 

allegations by GameFly under 39 U.S.C. 

404(b), and particularly defeating counts 

III and IV. See id. at 2. Section 404(b) 

mainly empowers the Governors ‘‘to 

establish reasonable and equitable 

classes of mail and reasonable and 

equitable rates of postage’’ consistently 

with chapter 36. 39 U.S.C. 404(b). 

Section 404(b) is not included in the 

grounds for complaints listed in section 

3662. 

GameFly asserts, by its Reply, that 

section 3662(a) incorporates section 

101(d). Reply at 5–6. It adds that ‘‘[b]y 

operation of Sections 401(2) and 101(d), 

the substantive standard of section 

404(b) thus is clearly justifiable in a 

complaint filed under section 3662(a).’’ 

Id. at 6. Section 101(d) is included in 

the grounds for complaints listed in 

section 3662(a). 

In view of these contentions, it is 

appropriate to explore whether the 

counts are properly based upon 

statutory authority that satisfies the 

usual notice pleading requirements. 

Each count includes by reference the 

first 39 paragraphs of the Complaint. 

See Complaint at paras. 52 and 54. 

Thus, each count properly may be read 

to assert a violation under sections 


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Federal Register / Vol. 74, No. 134 / Wednesday, July 15, 2009 / Notices 34375 

5See Complaint at para. 2 (the rates and services 

offered to high volume DVD mailers violate sections 

101(d) and 403(c), which prohibit undue 

discrimination, and inequitable rates and 

practices.); see also Answer at para. 2; and see 

generally Docket No. C2001–1, Order Partially 

Denying Motion of United States Postal Service to 

Dismiss Complaint and Notice of Formal 

Proceedings, March 20, 2001, at 9 n.11. 

1Notice of United States Postal Service of Filing 

of Functionally Equivalent Inbound Direct Entry 

Contracts, Negotiated Service Agreement, June 29, 

2009 (Notice). 

2See Docket No. MC2008–6, Decision of the 

Governors of the United States Postal Service on the 

Establishment of Prices and Classifications for 

Inbound Direct Entry Contracts with Foreign Postal 

Administrations (Governors’ Decision No.08–6), 

May 6, 2008. 

3See PRC Order No. 105, Order Concerning 

Prices Under Inbound Direct Entry Contracts with 

Certain Foreign Postal Administrations, September 

4, 2008, at 8 (Order 105). 

101(d) and 403(c), unless the allegations 

otherwise fail to state a colorable claim.5

The Postal Service’s dismissal motion 

overlooks that the contested counts 

expressly include other allegations 

based upon section 101(d). Each count 

plainly has at least one clear statutory 

basis upon which to seek recourse. 

Thus, despite its apparent reliance on 

section 404(b) at the very end of the 

counts, GameFly still satisfies the 

standards of pleading statutory 

authority at this juncture. See 

Complaint at 1, citing 39 U.S.C. 101(d), 

and 403(c). The Commission has 

determined that the Postal Service’s 

Motion for Partial Dismissal must 

therefore be denied. 

The Commission finds that the 

pleadings raise issues of both law and 

fact relevant to whether or not the 

actions, or inactions, of the Postal 

Service violate 39 U.S.C. 101(d) or 

403(c), either by (a) Rising to the level 

of undue discrimination or preferences 

among users of the mails, or (b) charging 

rates inequitably among such mailers. 

39 U.S.C. 3662(b). 

IV. Prehearing Conference and Public 

Representation 

A prehearing conference is scheduled 

for July 23, 2009 at 10 a.m. in the 

Commission’s hearing room. 

GameFly and the Postal Service must 

meet and confer at least two weeks 

before the conference date to consider 

the appropriate scope and timeframes 

for discovery. Discussion should 

separately address each of the categories 

mentioned in the Complaint. See 

Complaint at para. 41. They shall jointly 

prepare a prehearing conference 

memorandum that identifies relevant 

undisputed facts. They shall offer 

suggestions, and be prepared to discuss 

the proper scope of discovery and the 

dates to complete discovery and to 

present their cases. They are urged to 

stipulate to an orderly process that 

streamlines the discovery schedule so as 

to reduce the need for motions on any 

special challenges. Where a mutually 

acceptable process cannot be agreed to, 

GameFly and the Postal Service shall 

fashion a joint statement clarifying areas 

of contention. The joint prehearing 

conference memorandum, with any 

related proposed stipulations, must be 

filed no later than July 20, 2009. 

V. Opportunity for Intervention 

Except as otherwise specified above, 

any interested person may file a notice 

of intervention, consistent with the 

Commission’s rules of practice, as a full 

or limited participant. See 39 CFR 

3001.20 and 3001.20a. The notice of 

intervention shall be filed using the 

Internet (filing online) at the 

Commission’s Web site (http:// 

www.prc.gov) unless a waiver is 

obtained for hard-copy filing. See 39 

CFR 3001.9(a) and 3001.10(a). Notices of 

intervention are due no later than July 

22, 2009. 

Pursuant to 39 U.S.C. 505, E. Rand 

Costich and John Klingenberg are 

appointed to serve as officers of the 

Commission (Public Representative) to 

represent the interests of the general 

public in the above-captioned docket. 

VI. Ordering Paragraphs 

It is ordered: 

1. The Commission finds that the 

Complaint by GameFly, Inc., filed April 

23, 2009, regarding violations of law by 

the Postal Service, raises material issues 

of fact and shall begin proceedings in 

this Complaint. 

2. The Motion of GameFly, Inc. for 

Leave to File Reply to Request of the 

United States Postal Service for 

Disposition of Complaint, filed June 2, 

2009, is granted. 

3. The Motion of the United States 

Postal Service for Partial Dismissal of 

Complaint, filed May 26, 2009, is 

denied. 

4. The Commission will sit en banc in 

this proceeding. 

5. The deadline for filing any notices 

of intervention is July 22, 2009. Notices 

shall indicate whether the intervening 

party intends to participate in the 

hearing and the nature of that 

participation. 

6. A prehearing conference will be 

held in the Commission’s hearing room 

on July 23, 2009 at 10 a.m. At least two 

weeks before the conference, the parties 

shall meet and confer on discovery. 

They shall prepare a joint prehearing 

conference memorandum that must be 

filed no later than July 20, 2009. 

7. The Commission appoints E. Rand 

Costich and John Klingenberg as Public 

Representative to represent the interests 

of the general public in this proceeding. 

8. The Secretary shall arrange for 

publication of this order in the Federal 

Register. 

By the Commission. 

Judith M. Grady, 

Secretary. 

[FR Doc. E9–16782 Filed 7–14–09; 8:45 am] 

BILLING CODE 7710–FW–P 

POSTAL REGULATORY COMMISSION 

[Docket No. CP2009–41; Order No. 237] 

New Competitive Postal Product 

AGENCY: Postal Regulatory Commission. 

ACTION: Notice. 

SUMMARY: The Commission is noticing a 

recently filed Postal Service request to 

add an additional Inbound Direct Entry 

Contract to the Competitive Product 

List. The Postal Service has also filed a 

related contract. This notice addresses 

procedural steps associated with these 

filings. 

DATES: Comments are due July 10, 2009. 

ADDRESSES: Submit comments 

electronically via the Commission’s 

Filing Online system at http:// 

www.prc.gov. 

FOR FURTHER INFORMATION CONTACT: 

Stephen L. Sharfman, General Counsel, 

202–789–6820 and 

stephen.sharfman@prc.gov. 

SUPPLEMENTARY INFORMATION: 

I. Background 

On June 29, 2009, the Postal Service 

filed a notice, pursuant to 39 U.S.C. 

3633 and 39 CFR 3015.5, announcing 

that it has entered into an additional 

Inbound Direct Entry Contract (IDE), 

which it states fits within the previously 

established Inbound Direct Entry 

Contracts.1 The Postal Service states 

that the instant constant is functionally 

equivalent to previously submitted IDE 

contracts and is supported by the 

Governors’ Decision 08–6 filed in 

Docket No. MC2008–6.2 Notice at 2. 

The Notice also references Order No. 

105 which established the individual 

IDE contracts in Dockets Nos. CP2008– 

14 and CP2008–15 as functionally 

equivalent and added the contracts to 

the competitive product list as one 

product under the IDE classification.3

The IDE service allows the Postal 

Service to provide foreign postal 

administrations with the ability to ship 

sacks of parcels that are pre-labeled for 

direct entry into the Postal Service’s 

mail stream, in exchange for applicable 

domestic postage plus a sack handling 


sroberts on DSKD5P82C1PROD with NOTICES