In a complaint filed with the Postal Regulatory Commission, online video game rental service Gamefly accuses the US Postal Service of providing preferential treatment to Netflix and Blockbuster. The company says that its DVD’s are being damaged at an unacceptable rate despite the fact that the mailer has agreed to use sturdier mailers, and as a result pays higher postage fees per piece than the other companies. (The company also notes that a significant number of its DVDs are stolen- 19 postal employees have been arrested for stealing GameFly DVDs).

In addition, the company points out that Netflix mailers are routinely processed manually:

GameFly is not the only mailer to experience significant DVD breakage rates on automated mail processing equipment. In response to this phenomenon, 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.

A report by the Postal Service’s Office of Inspector General in November 2007 found that 70 percent of the two-way DVD mailers from one unnamed DVD rental company received manual processing for this reason. USPS Office of Inspector General, Audit Report No. MS-AR-08-001, Review of Postal Service First-Class Permit Reply Mail (November 8, 2007).

The Postal Service’s practice of giving manual processing to DVDs from certain large mailers has continued since the OIG report. On routine visits to multiple Postal Service facilities, GameFly’s employees have observed that a large percentage of mail pieces from Netflix and Blockbuster are culled from the automated letter processing stream.

GameFly has asked the Postal Service to give GameFly’s DVD mailers processing on terms and conditions comparable to the terms and conditions offered to two larger DVD mailers, Blockbuster and Netflix. The Postal Service has not done so.

The issue has taken on additional urgency for GameFly because of Blockbuster’s entry into the game rental market:

Until recently, none of the larger-volume DVD rental companies offered video games. On February 11, 2009, however, Blockbuster, which hitherto had offered only movie DVDs (which GameFly does not offer), announced that Blockbuster was expanding its DVD rental service to include video games in the second quarter of 2009.

As a result of this initiative, GameFly now faces direct competition from a rival that is larger and longer established—and which, because of the preferential treatment given by the Postal Service, enjoys a substantial cost advantage in the distribution of its DVDs to consumers.

The company says it has attempted to work out an agreement with the Postal Service, but that the USPS has ignored its requests to discuss the issue.

Seen on Postcom.org:

“From one of our readers on the proposed USPS summer sale:

“Comailed/comingled volume mailed under a vendor’s permit are not credited to the mail owner. Companies who take advantage of comingling efficiencies are penalized under this program. Mail volumes can be manipulated by moving mail from lettershops that comingle to lettershops where the mail owner has permits linked to their own CAPS account.

I’m sure that there are quite a few cominglers who do not support the proposal. There are issues with determining the level of corporate ownership. If our company acquires or divests wholly owned subsidiaries (or business segments) during the entire analysis time frame, the reconciliation becomes a nightmare. Is the discount available on a company basis, a subsidiary basis, or a product line basis within a company?

Most marketing plans (testing, scheduling, and purchasing) are planned months in advance. Direct mail promotion and product inventory issues become paramount. Internal business issues will arise if a division mails deeper into their list assuming the discount will be attained yet if the baseline is not exceeded product lines could falter/fail.

If the program is available only to the top 4,000 customers, I see litigation on the horizon. Within reason, companies will delay some mailings and accelerate others just to fit within the window of opportunity. This does not generate volume. I think it would be simpler, less costly, and less litigious to just delay the rate increase on Standard Mail letters and flats until September 2009 and then implement the summer rate program for 2010.”

Baltimore, Maryland – A federal grand jury indicted Marvin Lamont Foster, age 54, of Rosedale, Maryland, and Kyle Mathias, age 23, of Joppa, Maryland, today for conspiracy to steal from the United States Postal Service (USPS), announced United States Attorney for the District of Maryland Rod J. Rosenstein.

“Anyone who buys stamps at a discount should be on notice of the risk that they are purchasing stolen property,” said U.S. Attorney Rod J. Rosenstein.

According to the indictment, Foster was a window clerk at the Elkridge Post Office, having been employed there since 1998. First class postage stamps are provided by USPS to local post offices packaged in “bricks” which consist of 2,000 stamps valued at $840 per brick and “coils” which consist of 100 stamps valued at $42. The indictment alleges that from June 2008 through March 2009, Foster stole “bricks” and “coils” of stamps from the post office, which he provided to Mathias and others to sell. Mathias sold the stamps through an account he set up on E-bay. The indictment seeks forfeiture of $682,809.11, alleged to be the proceeds of the scheme.

Foster and Mathias face a maximum sentence of five years in prison.

An indictment is not a finding of guilt. An individual charged by indictment is presumed innocent unless and until proven guilty at some later criminal proceedings.

United States Attorney Rod J. Rosenstein thanked the U.S. Postal Inspection Service, the U.S. Postal Service – Office of Inspector General and U.S. Immigration and Customs Enforcement for their investigative work. Mr. Rosenstein commended Assistant United States Attorneys Sandra Wilkinson and Rachel M. Yasser, who are prosecuting the case.

According to Postcom (by way of the Mailers’ Council), USPS Senior VP Bill Galligan has made the following acting appointments:

Jordan Small is the acting vice president, Network Operations. He will be responsible for the USPS’ national transportation system and mail processing operations. Jordan was the vice president, Delivery Operations. Linda Welch is the acting vice president of the newly restructured Delivery and Post Office Operations organization. She will be responsible for the operation of the USPS’ 36,000 post offices. Welch was the district manager at the Dallas and Fort Worth Districts.

The following information was released by the United States Attorney’s Office for the Southern District of Texas:

Former rural carrier associate Rodney Ervin has been sentenced to prison for mail theft, access device fraud and aggravated identity theft, acting United States Attorney Tim Johnson announced today.

U.S. District Court Judge Melinda Harmon sentenced Ervin to one month imprisonment on the mail theft count, one month for the access device count to run concurrently. He will also serve a two-year mandatory statutory maximum sentence for the aggravated identity theft count, to run consecutively for a total of a 25-month sentence. Indicted on July 17, 2008, Ervin pleaded guilty on Nov. 7, 2008, admitting he stole mail containing credit cards from customers residing along Rural Route 127, delivered out of the Bear Creek Station located on Cairnway Drive in Houston.

Special Agents of the U.S. Postal Service Office of Inspector General (USPS-OIG) initiated an investigation upon receiving a customer complaint advising use of a Chase MasterCard credit card stolen from the mail. Follow-up investigation revealed two additional Chase credit cards stolen from the mail. USPS-OIG agents determined Ervin had been assigned to the effected route when the reported mail losses had occurred. In addition, Ervin was captured and identified from video surveillance at various merchant locations using the credit cards and signing the legitimate customers’ names. The customers advised they did not authorize Ervin possession or use of their credit cards and Ervin was identified as being responsible for $2,517.52 in fraudulent charges.

Following the sentencing of another rural carrier associate in just less than two weeks, also resulting in the mandatory two-year-term, once again, the USPS reiterates: “Identity theft is one of the fastest growing crimes in the United States and is a serious federal offense,” said Max Eamiguel, Executive Special Agent-in-Charge, USPS-OIG, Southwest Field Office. “The American public trusts the Postal Service to deliver its mail intact. When a postal employee betrays that trust and steals mail, then uses stolen financial information to wreak havoc in the lives of our citizens, Special Agents of the Postal Service’s Office of Inspector General investigate. Fortunately, these incidents are not common and the overwhelming majority of the 700,000 postal employees are honest and hard working. With the prosecutive support of the United States Attorney’s Office, we will aggressively pursue any employee committing a postal crime.”

Ervin began his employment with the United States Postal Service as a rural carrier associate on Aug. 28, 1999. His employment has since been terminated.

Ervin will be allowed to self-surrender to the Bureau of Prisons on within 45 days. In addition to the 25 months sentence plus the mandatory two-year prison term, Judge Melinda Harmon also imposed a two-term of supervised release to begin following his release from prison and further ordered he pay restitution to the victims in the amount of $2,517.52.

The investigation leading to Ervin’s indictment and arrest was conducted by Special Agents with USPS-OIG. The case was prosecuted by Special Assistant United States Attorney Tammie Y. Moore.

Posted on the NAPS member forum:

Executive Board Members,

We would like to update you on the status of our efforts to resolve the problems that we have with the Postal Service’s consolidation of Districts, their implementation of RIF avoidance and the changes that have been announced in the Plants across the country.

On April 7, 2009, our headquarters office advised the Postal Service, in writing, of our objections to the revised timeline that the Postal Service offered at our board meeting last week. We also advised the Postal Service that we intend to fully exercise our consultative rights under Title 39, in all of their announced plans.

It is our expectation that the Postal Service will provide NAPS with the opportunity to review all of the consolidation plans of the Postal Service and for NAPS to be able to offer alternatives to their plans within the scope of our right for consultation and then receive a written response following our consultations.

We have not received a response from the Postal Service to our position letter, and we are awaiting a reply. As soon as further information is available we will let you know.

NAPS Headquarters

Ted Keating, National President
Louis Atkins, Executive Vice President
Jay Killackey, Secretary/Treasurer
Timothy May, NAPS General Counsel, Patton & Boggs
Charles Scialla, President, Scialla & Associates
NAPS National Executive Board Members

For the United States Postal Service:

George Butler, Chief Counsel, United States Postal Service
John Mularski, Manager, Complement, Staffing & Field Policy, USPS HQ
William T. Jones, Manager, Labor Relations, Policy Administration
Lee Olohan, Labor Relations Specialist

Item #1

In the announcement there is a description of those in the consolidated District’s eligible to retire. Does the term “eligible to retire” indicate VERA eligibility or eligibility to retire without penalty?

USPS Response:

The reference to eligible employees is a combination of employees eligible for regular/optional retirement and VERA.

Item #2

We are requesting, for our use as well as our field vice-presidents, a listing of all vacancies that exist in Customer Services operations that will serve as landing-zones for impacted employees. If there are different numbers for these two categories, what are they?

USPS Response:

This list is now being compiled at USPS Headquarters, it is not yet ready. Read the rest of this entry »

(Press release from the Universal Postal Union)

High-level conference reveals risks and opportunities for the sector and the world economy

The results of a recent Universal Postal Union (UPU) survey indicate that postal networks are increasingly trusted to further the growth of e-commerce and provide financial services. This trust is keeping this postal sector’s head above water as the financial crisis wreaks havoc on the global economy.

While operators are feeling the pinch, especially in the letter-post and express business segments, financial services and some areas of parcel post are showing signs of growth.

This is what the UPU reported today during a high-level conference on the impact of the financial and economic crisis on the postal sector, held at its Berne headquarters. More than 200 participants from 100 countries, including about 40 of the world’s postal CEOs and leading sector stakeholders operating in e-commerce, direct marketing, consulting and equipment and technology manufacturing, attended the special debate. Read the rest of this entry »

Press release from United States Attorney’s Office, Eastern District of Louisiana:

GERONIMO A. CELLAMARE, age 46, a resident of Westwego, Louisiana, pled guilty in federal court today before U. S. District Judge Helen Berrigan to unlawfully detaining, delaying and opening United States mail, announced United States Attorney Jim Letten.

According to the factual basis, the defendant admitted that in September and October, 2008 he had detained and failed to deliver approximately 2950 pieces of First Class Mail, Second Class Mail, Presorted-Standard Political mail, Standard mail, and ADVO advertisement mail. All of the mail was found in his apartment on October 3, 2008 pursuant to the executio of a Federal Search Warrant by the United States Postal Service, Office of Inspector General.

CELLAMARE faces a maximum term of imprisonment of five (5) years, a fine of $250,000.00 and three (3) years of supervised release following any term of imprisonment. Judge Berrigan scheduled sentencing in this matter for July 8, 2009 at 9:00 A.M.

The case was investigated by the United States Postal Service-Office of Inspector General. The case is being prosecuted by Assistant U. S. Attorney Marvin Opotowsky.

Factual basis:

Should this matter have gone to trial, the Government would have proved, through the introduction of competent testimony and admissible tangible exhibits, the following facts, beyond a reasonable doubt, to support the allegations in the Bill of Information now pending against the defendant, GERONIMO A. CELLAMARE The defendant has agreed to plead guilty to Count One of a Bill of Information charging the defendant with a violation of Title 18, United States Code, Section 1703(a) relative to felony delay of the United States mail.

On October 3, 2008, a search warrant was executed at the residency of the defendant, GERONIMO A. CELLAMARE, located in Westwego, Louisiana, in the Eastern District of Louisiana by United States Postal Inspectors. Upon searching the defendant’s apartment, the United States Postal Inspectors found 829 pieces of First Class mail, 57 pieces of Second Class mail, 921 pieces of Presorted-Standard Political mail, 732 pieces of Standard mail, and 412 pieces of ADVO advertisement mail. The mail was seized by postal inspectors and taken to their offices.

A supervisor for the United States Postal Services, Westwego Post Office, would testify that the defendant, GERONIMO A. CELLAMARE, was a United States Postal Service Transitional Employee city letter carrier during the months of September and October, 2008.

The supervisor would testify the addresses on the mail seized from the defendant’s apartment on October 3, 2008, was United States mail assigned to him for delivery and should have been delivered by the defendant on mail routes that he was assigned to during that period of time.

Additionally, the supervisor would state all of the mail found at his apartment was addressed to more than 250 individuals, organizations, or companies who should have received this mail. The supervisor would further state all of the United States mail described above was entrusted to GERONIMO A. CELLAMARE in his capacity as a United States Postal Service letter carrier
and it should have been conveyed and delivered to the addresses stated on the mail therein without any delay. The defendant was not authorized to detain or retain any United States mail in his personal possession for any reason.

An individual will testify that he/she confronted the defendant concerning his failure to deliver the mail described above and the defendant stated to him/her that he was tired and could not deliver all his mail so he brought the mail to his apartment.

City Calls On California To Give Citizens Choice Over Junk Mail

SAN FRANCISCO, March 31 — The San Francisco Board of Supervisors today passed a resolution calling on California to create a Do Not Mail Registry giving its citizens the choice to stop receiving unwanted junk mail.

Though non-binding, the resolution represents the first time American lawmakers have withstood pressure from the direct mail industry and the U.S. Postal Service to side with the majority of Americans.

Sponsored by Supervisor Ross Mirkarimi, the board approved the resolution by a 9-2 vote.

“Until now, junk mailers have stifled all efforts to give Americans what they want: an enforceable, comprehensive solution to junk mail’s waste and annoyance” said ForestEthics Executive Director Todd Paglia. “San Francisco is the first city in the United States to take political action against junk
mail, marking the beginning of a long-awaited government intervention to protect citizens from relentless and predatory junk mailers.”

Bills calling for Do Not Mail Registries have failed in more than 20 states, despite widespread frustration with junk mail. A 2007 Zogby poll revealed that 89% of Americans support the creation of a national registry.

“Reducing junk mail is in keeping with our nation’s efforts to reduce our carbon footprint and lead more sustainable lifestyles,” said Supervisor Ross Mirkarimi, upon passage of his Do Not Mail Resolution. “Just as Do Not Call overcame industry opposition to become the most popular consumer rights bill in history, I hope that this resolution will empower our representatives on the state and federal level to represent their constituents on this issue.”

Supervisor Mirkarimi has a record of trailblazing leadership on a variety of issues and policies, including the nation’s first municipal ban on plastic bags, and commuter benefits requirements for San Francisco businesses.

More than 93,000 Americans have signed ForestEthics’ petition at donotmail.org calling for the creation of a national Do Not Mail Registry.

Every year 100 million trees are logged to produce the 100 billion pieces of junk mail Americans receive. Junk mail’s production generates the carbon emissions of over 9 million cars. U.S. junk mail accounts for 30% of all the mail delivered in the world, though 44% of it goes to landfills unopened.

Visit donotmail.org for more information.

SOURCE ForestEthics

William Craven of ForestEthics, +1-415-407-3426