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Wednesday, August 15, 2012

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Federal Judge Rules in Favor of the U.S. Postal Service
In Civil Suit Over Change in Postage Meter Regulations

     WASHINGTON - A federal judge has ruled in favor of the U.S. Postal Service in a longstanding civil suit filed by various postage meter manufacturers over changes in regulations, U.S. Attorney Ronald C. Machen Jr. announced today.

     The Honorable Senior Judge Paul L. Friedman issued a 76-page ruling on Aug. 14, 2012, in the case of Ascom Hasler Mailing Systems, Inc., and Neopost, Inc, v. U.S. Postal Service. The decision followed 12 years of litigation. In their suit, filed in the U.S. District Court for the District of Columbia, the meter manufacturers asserted legal claims that changes in U.S. Postal Service regulations improperly deprived them of revenue from a computerized remote resetting system, which is used to reset customers’ postage meters remotely.

     Under the old regulations, postage meter customers were required to send their postage payments to the meter companies, who then paid the monies to the U.S. Postal Service after the customer checks cleared their banks. The new regulations removed the postage meter middle-man, and required that all postage payment be sent directly to the U.S. Postal Service. As a result, the postage meter companies claimed that they were deprived of over $80 million in interest on the monies held in their trust accounts. They argued that they had a contractually and constitutionally protected property right to the money.

     After a five-day trial earlier this year, and post-trial briefing by the parties, Senior Judge Friedman found that no contract existed between the meter manufacturers and the U.S. Postal Service that protected the manufacturers’ right to the interest earned, and further that the regulations did not amount to an unconstitutional taking of property because it did not deprive the manufacturers of the value or profitability in the meter manufacturing business.

     In announcing the decision, U.S. Attorney Machen commended the work of Assistant U.S. Attorneys Darrell C. Valdez and Carl “Zeke” Ross of the Civil Division. He also acknowledged the efforts of attorney Mark Corbly of the U.S. Postal Service General Counsel’s Office, who worked tirelessly with Assistant U.S. Attorney Valdez on the case since it was filed in June 2000 and assisted Assistant U.S. Attorneys Valdez and Ross with the trial presentation and post-trial briefing.





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