Source: https://law.justia.com/cases/federal/appellate-courts/F2/485/768/399352/
Timestamp: 2019-11-12 20:39:39
Document Index: 120495875

Matched Legal Cases: ['§ 3628', '§ 201', '§ 401', '§ 3626', '§ 101', '§ 201', '§ 3601', '§ 3622', '§ 3622', '§ 3625', '§ 3628', '§ 3628', '§ 101', '§ 3622', '§ 101', '§ 101', '§ 3622', '§ 3626', '§ 3627', '§ 3626', '§ 3626', '§ 3626', '§ 3622', '§ 3625', '§ 3622', '§ 3622']

Association of American Publishers, Inc., et al. v. the Governors of the United States Postal Service et al., Respondents,direct Mail Advertising Association, Inc., et al., Intervenors.associated Third Class Mail Users, Petitioner, v. the Governors of the United States Postal Service, Respondent,j. C. Penney Company, Inc., and United Parcel Service, Intervenors, 485 F.2d 768 (D.C. Cir. 1973) :: Justia
Justia › US Law › Case Law › Federal Courts › Courts of Appeals › D.C. Circuit › 1973 › Association of American Publishers, Inc., et al. v. the Governors of the United States Postal Servic...
Association of American Publishers, Inc., et al. v. the Governors of the United States Postal Service et al., Respondents,direct Mail Advertising Association, Inc., et al., Intervenors.associated Third Class Mail Users, Petitioner, v. the Governors of the United States Postal Service, Respondent,j. C. Penney Company, Inc., and United Parcel Service, Intervenors, 485 F.2d 768 (D.C. Cir. 1973)
U.S. Court of Appeals for the District of Columbia Circuit - 485 F.2d 768 (D.C. Cir. 1973) Argued Nov. 6, 1972. Decided June 26, 1973
In these two actions, brought on the basis of the original jurisdiction conferred on this court by Postal Reorganization Act of 1970, 39 U.S.C. § 3628, Association of American Publishers, Inc., American Library Association, and National Association of College Stores, Inc., (all being petitioners in the first action, No. 72-1641) and Associated Third Class Mail Users, (petitioner in the second action, No. 72-1726) seek review of different orders of the United States Postal Service.
In both cases petitioners named as respondents the Governors of the Postal Service. In 72-1641 the United States Postal Service, an independent establishment of the Executive Branch, created by Act of August 12, 1970, 84 Stat. 720, 39 U.S.C. § 201 et seq., is also named as a respondent.
Clearly the Postal Service was an appropriate respondent inasmuch as Congress provided that it could be "sued in its official name." 39 U.S.C. § 401(1), as is commonly true of such administrative agencies as the Federal Reserve Board, ICC, FTC, NLRB, and SEC. Indeed it seems that action should have been brought only against it and not the Governors, who are, like Governors of the Federal Reserve Board, or members of the ICC, FTC, NLRB and SEC, not appropriate respondents when a board order is challenged on usual Constitutional, statutory, or similar grounds. The Governors of the Postal Service, unlike the former Postmasters-General, are not heads of a department which has no capacity to sue and be sued as though it were a corporate entity. But inasmuch as in these two cases the Governors have not raised this point, and the petitioners' error in pleading is one of refined technicality without substantive significance, and one which could easily be corrected, we shall treat the petitions as though they had been amended.
In the second of the two cases, 72-1726, different petitioners seek review of the Service's June 29, 1972 order eliminating the phasing of the increases in permanent third class mail alleged to be required by Section 3626 of the Postal Reorganization Act, 39 U.S.C. § 3626, and putting in effect increased postal rates recommended by the Postal Rate Commission on June 5, 1972.
The Postal Reorganization Act, 39 U.S.C. § 101 et seq., substituted for the long-established Post Office Department the Postal Service, as an "independent establishment of the executive branch of the Government" 39 U.S.C. § 201. 39 U.S.C. § 3601 created the Postal Rate Commission also as an "independent establishment of the executive branch of the Government."
39 U.S.C. § 3622(a) provides that if the Postal Service believes that permanent changes in postal rates are appropriate, it shall request the Commission to submit a recommended decision on rate changes.
Then 39 U.S.C. § 3622(b) requires that upon receiving a request, the Commission shall make a recommended decision, taking into account certain factors, which, for the moment, we need not recite.
Pursuant to 39 U.S.C. § 3625(a), "upon receiving a recommended decision from the Postal Rate Commission, the Governors may approve, allow under protest, reject, or modify that decision in accordance with the provisions of this section."
Finally, 39 U.S.C. § 3628 provides for judicial review of a decision of the Governors. No doubt, what was contemplated, despite the unfortunate choice of words, was that the review is to be of an order of the Postal Service rather than of a "decision of the Governors," to which the draftsman of the statute loosely referred. Decisions in the sense of opinions are not reviewable; orders are. Governors are not, but the Service as an entity which Congress made suable is, properly charged as a respondent accountable for legal errors in or implicated in an order of the Service based upon the Governor's decision. Of course, this does not mean that if personally, or in some official capacity other than as a signatory to an order of the Postal Service, a Governor erroneously, negligently, or willfully injured some person, the Governor might not properly be named in some proceeding a defendant; though we avoid, as unnecessary for decision in this case, the prickly issue as to whether he would be suable as a respondent in this court in a proceeding brought under 39 U.S.C. § 3628.
February 1, 1971 the United States Postal Service, in accordance with the Postal Reorganization Act of 1970, 39 U.S.C. § 101 et seq., submitted to the Postal Rate Commission a request for a recommended decision authorizing increases in postal rates for all major classes and subclasses of mail, except zone rate fourth class mail.
The Postal Service, in preparing for a hearing before the Chief Examiner, whose duty included taking into account the factors listed in 39 U.S.C. § 3622(b), planned to present evidence showing actual costs and expenses related to postal service previously rendered. The Service in going over its records discovered that postal employees had made errors in the first half of Fiscal Year 1970 by classifying as parcel post, packages actually carried as special rate fourth class mail. To correct the impact of this error the Postal Service used the results of a two-weeks audit, made in November 1969, to shift $35.1 million of attributable costs projected for Fiscal Year 1972 from parcel post to special rate fourth class mail.
With respect to the first point, in the language of Justice Douglas in New York v. United States, 331 U.S. 284, 328, 67 S. Ct. 1207, 1230-1231, 91 L. Ed. 1492 (1947):
It would, of course, be the summum bonum if we had accurate figures as to recent costs of carrying special fourth class mail. The only available figures were inaccurate, but were susceptible of rough adjustment. The Postal Service proposed one method of adjustment; the Chief Examiner, another. The Commission regarded each as helpful, but not wholly reliable. So the Commission more or less split the difference. No doubt it would have been possible to straighten out some of the errors or supposed errors of adjustment in either the Postal Service's or the Chief Examiner's calculations. And if rate-making were an exact science such a counsel of perfection would be mandatory. But, though courts hesitate so to admit, they know that in the rate-making area, John Selden was prophetic in declaring that in governing it is not juggling, but too much juggling that is to be blamed. In any case, the rough splitting of a difference between two fairly but not wholly satisfactory rate calculations is a familiar permissible technique. It is not like the situation in International Harvester v. Ruckelshaus, 155 U.S. App.D.C. 411, 478 F.2d 615, 1973, where the regulatory administrative agency rejected both the method and the results of an expert body and substituted arbitrarily its own method and prediction. That is a quite different situation from what happened here, where the regulatory administrative agency did not entirely disregard two experts, but found each somewhat in error, and took as its own solution a point somewhere between the two expert figures. When neither of two suggested adjustments applied to inaccurate data is completely satisfactory a rate-making body may fashion its own adjustments within reasonable limits. Market Street Railway Co. v. Railroad Commission, 324 U.S. 548, 560, 65 S. Ct. 770, 89 L. Ed. 1171 (1945); Permian Basin Area Rate Cases, 390 U.S. 747, 800, 817-818, 88 S. Ct. 1344, 20 L. Ed. 2d 312 (1968). Since Solomon's day, to split the difference or to come close thereto has been thought wise, if only because it makes parties more likely to disclose to tribunals the truth.
Obviously this is not a contention that the rates are discriminatory. The claim is that in reaching a rate result, the Commission failed to apply if not the precise language, at least the fair intendment, of the policy declared by and the criteria set forth in the United States Postal Service Act; Act of Aug. 12, 1970, 84 Stat. 719, 39 U.S.C. § 101 et seq. Reliance is placed particularly on parts of the Declaration of Postal Policy in Section 101 of the Act, 84 Stat. 719, 39 U.S.C. § 101 and what may for convenience be called "the factor sheet," that is the criteria listed, in Section 3622(b) of the Act, 84 Stat. 760, 39 U.S.C. § 3622(b).
Section 3626 of the Postal Reorganization Act, 39 U.S.C. § 3626, provides for third class mail rates which are to be at a high level immediately unless there is what is called by the parties here "the phasing of increases in permanent third-class mail rates." Petitioners in 72-1726 claim that the part of the June 29, 1972 order to which they object by putting the high rates into effect immediately, unlawfully eliminates the phasing of increases.
It is undeniable that the June 29 order puts into effect the Section 3626 increases without gradually "phasing" them. But the reason the Governors, like the Commission, gave for ignoring the "phasing" and making the increase immediate in its total impact was that this is what Congress directed should be the result in a situation where Congress had failed to appropriate funds within the meaning of Section 3627 of the Act, 39 U.S.C. § 3627, which provides:
What the dispute between the parties in 72-1726 turns on is the legal question whether the governors could properly have concluded that Congress had failed to appropriate for the Fiscal Year 1973 for third class regular mail so-called "revenue foregone" funds, i. e., the sum which the Postal Service had determined it would lose because of a rate preference which had been, by the phasing provisions of 39 U.S.C. § 3626, conditionally allowed to third class mail.
There is no factual dispute. The Service asked Congress to appropriate for the Postal Service $1,640.4 million, of which $687.9 million was requested for revenue foregone. The Office of Management and Budget, on behalf of the President, submitted to Congress a total Postal Service Appropriation of $1,424.039 million, of which $471.5 million was for revenue foregone. The Director of OMB wrote to the Postmaster-General a letter, transmitted to Congress, explaining that the President's request did not include $216 million of revenue foregone funds necessary for phasing third class regular rate and controlled circulation mail. The Postal Service informed Congress that if it failed to restore the $216 million the Postal Service would treat that failure as a failure of revenue foregone for the purpose of applying 39 U.S.C. §§ 3626 and 3627. Congress did not vote the funds requested by Postal Service, and even cut the Budget's figures by $14.039 million, and made a lump sum appropriation of $1,410 million for the Postal Service.
While petitioners with subtlety and skill weave an argument for their position that Congress did not fail to appropriate the amount required to meet the statutory condition which was precedent to the phasing of the increase in postal rates for third class matter, we are more amazed at its ingenuity than persuaded by its soundness. It seems to us quite plain that if in good faith (which no one denies) the Postal Service specifies how many dollars it must get from Congress in order not to be in the hole with respect to carrying third class mail, then, regardless of Budget officials or others outside the Postal Service, the Postal Service's conclusion fixes the amount of revenue foregone in so far as that concept is used in 39 U.S.C. §§ 3626 and 3627 or other parts of the Postal Service Act.
See Permian Basin Area Rate Cases, 390 U.S. 747, 88 S. Ct. 1344, 20 L. Ed. 2d 312 (1968)
39 U.S.C. § 3622(b). Technically, the Postal Rate Commission merely renders a "recommended decision." But, as the Board of Governors observed in its opinion in this case, the power of the Board to revise that opinion is extremely narrow. See 39 U.S.C. § 3625 (1970)
39 U.S.C. § 3622(b) (3) (1970) (emphasis and numbering added)
See 39 U.S.C. § 3622(a) (1970)