In the Matter of the Petition by                                   )
                                                                                  )
STANDARD RATE AND DATA SERVICE, INC.           )
5201 Old Orchard Road                                            )
Skokie, Illinois 60067                                                  )
                                                                                   )
                                                                                   )
                                                                                   )
    Proposed Revocation of Second-Class                 )
    Mail Privileges for                                                   )
    "BUSINESS PUBLICATION RATES & DATA";          )
    "CONSUMER MAGAZINE & FARM PUBLICATIONS )
      RATES & DATA";                                                  )
    "NETWORK RATES & DATA";                                 )    P.S. Docket No. 4/20
    "NEWSPAPER RATES & DATA";                             )
    "SPOT RADIO RATES & DATA";                             )
    "PRINT MEDIA PRODUCTION DATA";                      )
   "SPOT TELEVISION RATES & DATA";                     )
   "CHANGE BULLETIN-BUSINESS PUBLICATION       )
     RATES & DATA";                                                   )
   "CHANGE BULLETIN-CONSUMER MAGAZINE &     )
     FARM PUBLICATION RATES & DATA";                 )
   "CHANGE BULLETIN-NEWSPAPER RATES &          )
     DATA";                                                                  )
   "CHANGE BULLETIN-SPOT RADIO RATES &          )
     DATA";                                                                  )
     and "CHANGE BULLETIN-SPOT TELEVISION        )
     RATES & DATA"                                                   )

APPEARANCES:
                                                                              Timothy J. May, Esq.
                                                                               David B. Robinson, Esq.
                                                                               Patton, Boggs & Blow
                                                                               1200 Seventeenth Street, N.W.
                                                                               Washington, D. C. 20036
                                                                               for Petitioner

                                                                               Arthur S. Cahn, Esq.
                                                                               Gerald E. Cerasale, Esq.
                                                                               Law Department
                                                                               U. S. Postal Service
                                                                               Washington, D. C. 20260
                                                                               for Respondent

            Lussier, Edward F.

POSTAL SERVICE DECISION

This case is on appeal by the Petitioner, Standard Rate and Data Service, Inc., from the Initial Decision of Administrative Law Judge Rudolf Sobernheim which concluded that revocation of Petitioner's second class mail privileges for the publications in issue, was proper. Both parties have filed briefs stating their respective positions on appeal. Petitioner has taken various exceptions on appeal. Respondent while filing a Reply Brief has taken no exceptions on appeal. The appeal is before me on the validity of the grounds upon which the Initial Decision rests. I have carefully considered these briefs. While Petitioner's Brief aptly sets forth the best argument that can be made in support of its view it does not persuade me that Judge Sobernheim erred in reaching the conclusion that Petitioner's publications are not entitled to second class mail privileges.

For ease of reference Petitioner's summary of its exceptions to the Initial Decision is here set forth in full:

"II. EXCEPTIONS.

Petitioner respectfully notes the following exceptions to the Initial Decision of the Presiding Administrative Law Judge:

1. The Presiding Judge erred in finding that the Change Bulletins are not entitled to retain second class entry as newspapers. The Judge's finding was based exclusively (CL 9 at 37) upon an erroneous factual assumption.

2. The Presiding Judge erred in finding that SRDS reports on the media which appear in the monthly, bi-monthly, and quarterly publications are not articles.

3. The Presiding Judge applied an improper legal standard when he held that an absence of 'articles' (as he defined and applied the term) by itself disqualified the SRDS publications from the second-class mails.

4. The erroneous legal conclusions of the Initial Decision flow in part from incorrect and incomplete findings of fact about the nature and uses of the publications. Petitioner will not attempt to enumerate every omitted fact which, if included in the Initial Decision, might have contributed to a more complete understanding of the publications and of the record in this case. For that purpose, Petitioner would respectfully refer the Judicial Officer to the Proposed Findings of Fact set forth in Petitioner's Initial Brief. Petitioner would note here, however, these specific errors of fact in the Initial Decision.

a. The assumption, unsupported by the record, that the Change Bulletins are 'unusable and largely ununderstandable' without the corresponding monthly publication (CL 9). This assumption is in disregard of the testimony of Petitioner's Publisher and of the content of the publications.

b. The vast understatement of the amount of change appearing from issue to issue in the monthly and quarterly issues, in part arising from an assumption contrary to the record about the nature and function of the Change Bulletins and the failure to recognize the volatility of the information reported on by SRDS.

c. The finding that SRDS reports on the media are 'list s of available services and price terms' (FF 11(e)), with the accompanying conclusion that SRDS reports should be treated no differently than price lists for alcoholic beverages, William R. Good, P.S. Docket No. 2/123 (1975), or lists of used car prices, National Automobile Dealers Used Car Guide Company, P.S. Docket No. 2/183 (1975). This fundamental error underlies much of the decision (FF 11, CL 6)."

Judge Sobernheim in essence found that the publications did not meet the legal definition set forth in the case of Houghton v. Payne, 194 U.S. 88 (1904) in that the media listings which constitute about 95% of their content did not qualify as original articles within the meaning of Houghton v. Payne. ^1/ He further found that the change bulletins were not independent publications but rather integral parts of the basic publications and not entitled to treatment as newspapers.

Petitioner contends that the holding on the change bulletins was based upon an erroneous factual assumption that the change bulletins are unusable and largely ununderstandable without the main publication to which they refer. It further moves that the record be reopened to take further evidence should the undersigned determine that it is not apparent that the publications are understandable. The motion must be denied. The present record makes quite clear how the change bulletins are utilized, the importance of the scope of the information reported in the basic publications, the need for accurate updating, the limited coverage of the change bulletins and their use in conjunction with, and as part of, the basic publication. It is clear that they are not newspapers but rather, as the Initial Decision found, "in their content and arrangement integral parts of the publications, changes in the contents of which they report."

As I read his decision, after my independent review of the record, Judge Sobernheim did not suffer from any basic misunderstanding of the purposes, nature or content of the change bulletins. Nor do I perceive any material error attributable to a failure to give greater weight to the amount of change reported in the various publications. Petitioner is correct, however, in its contention that finding of fact 15, which discusses petitioner's Exhibit P-7, overlooks that part of the Exhibit which reflects the number of listings affected by changes. That Exhibit shows that in the year 1961 the monthly average for total number of category changes was 1,782 and also that the number of listings in which changes were made was 1,123 for an average of 53.8% of the total listings in which changes appeared. The testimony of petitioner's witness, Mr. Harvey A. Harkaway, confirms that from month to month there will be some changes in 50% of the media reports published (Tr. 129). To this extent the findings are hereby corrected and amplified although in the final analysis the ultimate conclusion is unaffected thereby.

Petitioner's emphasis upon what it considers the fundamental error of the Initial Decision's reference to the media reports as "lists" makes more of the matter than did the Initial Decision as shown by Conclusion of Law 7 wherein it is stated "I do not hold that the sum of all listings in BPR&D forms a 'list' but that by virtue of their format, selected for practical reasons by petitioner, the listings do not constitute 'articles' within the meaning of Houghton v. Payne, supra."

The Administrative Law Judge's description of the publications in finding of fact 11 as carried over into conclusion of law 6 is supported by the record and gives an essentially accurate picture. Petitioner's emphasis upon the effort that goes into publishing the media reports, the importance of their timeliness and their use to subscribers does not alter their objective content. Perhaps the rule could be written to give precedence to these and other factors, although to do so without definitive standards, would provide far greater problems in the application and enforcement than the adherence to the more simple and direct rule of Houghton v. Payne. At the present the fairer course to all, the public at large included, requires adherence to the stricter rule. The publications clearly do not fall within the category of magazines or newspapers. Although argument can be made that the content consists of original articles Judge Sobernheim's decision expresses what I consider the better view. While there are some factual differences between Petitioner's publications and others dealt with in the cases cited in the Initial Decision they are not material to the outcome when the publications are reviewed in light of all of the facts.

Petitioner's contentions with respect to a more limited application of Houghton v. Payne, and the error of administrative decisions to the contrary, are not new and, as pointed out in Geological Society of America, P.S. Docket No. 4/150 (Oct. 1976), have not met with success either here or upon judicial review of our decisions on the point. Petitioner's effort to minimize the holding in Teleflora Incorporated v. USPS, Civil Action No. 75-228 (U.S.D.C. D.C., Order dated June 25, 1975) is not very persuasive on the record in that case. A more recent decision containing a clear ruling upholding the Postal Service's view may be found in Institute for Scientific Information, Inc. v. USPS, Civil Action No. 75-3528, Memorandum Opinion and Order, dated June 15, 1976 (U.S.D.C. E.D. Pa.).

CONCLUSION

Petitioner's exceptions to the Initial Decision are disallowed and it is hereby affirmed.

1/ As to one of the publications, "Network Rates and Data" the Initial Decision found it almost entirely composed of lists.