In the Matter of the Petition By:

WISE ENTERPRISES,
P.O. Box E,
Leesville, LA 71496-0777;

Proposed Revocation of Second-Class Mail Privileges for
LEGAL NEWS PUBLICATIONS

P.S. Docket No. 30/169

Grant, Quentin E., Chief Administrative Law Judge

APPEARANCE FOR PETITIONER:
Alvin C. Dowden, Jr., Esq.,
Mitchell and Dowden,
607 South Fifth Street,
Leesville, LA 71446-4499

APPEARANCE FOR RESPONDENT:
Jeffrey H. Zelkowitz, Esq.,
Law Department,
Rate Application Division,
United States Postal Service,
Washington, DC 20260-1143

INITIAL DECISION

Petitioner appeals from the determination of the Director, Office of Classification and Rates Administration, dated June 7, 1988, revoking second-class mail privileges for two publications, both named Legal News Publications, and determining that several other publications being mailed under the second-class authorization for one of the Legal News Publications are separate and distinct periodical publications each requiring a separate second-class authorization.

The parties have submitted the matter for decision based on a Joint Stipulation of Facts and Exhibits, dated January 9, 1989. The parties have also filed written argument all of which has been considered. Of the facts stipulated by the parties, the findings of fact below include only those relevant and material to the issues. Based on the entire record, I make the following findings of fact and conclusions of law:

FINDINGS OF FACT

1. The Petitioner in this proceeding is Wise Enterprises, owned by Eddie Wise. Petitioner's business office is located at 207 Concord Street, Leesville, Louisiana 71496. Its mailing address is P.O. Box E, Leesville, Louisiana 71496.

2. Petitioner produces nine publications. Each consists of brief abstracts or summaries of legal and public record information.

3. Eight of the publications contain a wide range of information including bankruptcy and other court filings, judgments, mortgage and deed filings, liens, drilling permits, incorporations, mergers, partnerships, and dissolutions, marriage licenses, and births. Petitioner obtains and prints this information for Orange County, Texas, and for seven parishes in Louisiana: Acadia, Beauregard, Calcasieu, Cameron, Jefferson Davis, Vermilion, and Vernon. The content of each of the eight publications produced by Petitioner is devoted to information concerning a particular county or parish. Accordingly, the content of each of these eight publications is distinct from the contents of the publications produced for each of the other counties and parishes.

4. A ninth publication is known as the Southwest Louisiana Bankruptcy Report. This publication prints abstracts of bankruptcy filings in fourteen Louisiana parishes, including the seven parishes listed in P3, above. Because the publications described in P3 may contain bankruptcy information, there may be a small overlap between the contents of these publications and the Southwest Louisiana Bankruptcy Report.

5. The initial page of each publication produced by Petitioner bears the title "Legal News Publications," along with the words "Edition for" followed by the name of the county or parish featured in that publication or by "Southwest Louisiana Bankruptcy Report."

6. Each of the nine publications produced by Petitioner is published weekly, and each is produced from Petitioner's business office in Leesville.

7. Until the end of July 1988, each of the nine publications produced by Petitioner carried its own unique volume and issue number and date. In July 1988, a mail classification official told Petitioner that the unique volume and issue numbers were an indication that the nine publications were separate and distinct periodical publications. Thereafter, beginning in August 1988, Petitioner changed the volume and issue numbers in each publication so that all are labeled as volume 88. The issue number is the number of weeks that have passed since January 1.

8. Each of petitioner's nine publications has its own separate subscription price.

9. The lengths of the publications produced by Petitioner vary. For instance, a typical issue of the publication produced for Calcasieu Parish, which is called the Daily Recorder, is twelve pages, while a typical issue of the publication produced for Vernon Parish is four pages.

10. Joint Exhibits 1 through 9, are copies of each of the nine publications during the week of May 24, 1988.

11. Petitioner is listed as the publisher for two second-class authorizations issued in Leesville, Louisiana, each of which is for a publication whose authorized title is Legal News Publications. One of the authorizations is for a publication which has been assigned USPS publication number 145-380 referred to hereafter as Authorization 145-380. The second authorization is for a publication assigned USPS publication number 695-370 referred to hereafter as Authorization 695-370.

12. The authorized frequency of Authorization 145-380 is twice per week. The authorized frequency of Authorization 695-370 is three times a week.

13. Authorization 145-380 was issued on October 21, 1963, with an effective date of May 8, 1963. It was originally issued in Sulphur, Louisiana. Postal records indicate that the most recent reentry for the publication was September 9, 1983, which was the date that the original entry office was changed to Leesville, Louisiana.

14. Petitioner produced three of its publications at the time that the application for Authorization 145-380 was issued in Sulphur.

At the time it sought to reenter this authorization to Leesville in 1983, Leesville postal officials raised the question of how many second-class authorizations Petitioner needed, and told Petitioner, based upon written advice received from a United States Postal Service classification official, that it needed only one authorization. This advice did not affect Petitioner's operations. That is, if Petitioner had been advised that its publications were separate and distinct and that a second-class authorization was needed for each, it would have applied for such authorizations and paid the appropriate application fees. Petitioner also would have initiated each of the other publications that it currently produces, and would have sought a second-class authorization for each and paid the appropriate application fees.

15. Three of Petitioner's publications were produced at the time Authorization 145-380 was issued. Petitioner's other six publications have been initiated within the last five years. In view of the advice received from Leesville officials in 1983 (as described in P14, above), Petitioner did not apply for second-class authorization for these publications but mailed them under the existing authorization for Legal News Publications.

16. Authorization 695-370 was issued on July 20, 1983, in Leesville, with an effective date of April 2, 1983.

17. Each of Petitioner's nine publications, produced once per week, is mailed under Authorization 695-370. Petitioner submits a mailing statement approximately once each month to cover all issues of its nine publications produced during that period. For example, the mailing statement dated June 4, 1988, concerns the 37 issues published from May 3, 1988, through May 31, 1988 (JX-10). The Leesville Post Office maintains a record of the deposit account for postage paid under Authorization 695-370 (JX-11).

18. Petitioner makes no mailings under Authorization 145-380.

19. The dispute involved in this case began in July 1987, when Petitioner sought to change the authorized frequency for Authorization 145-380 from two times per week to four times per week.

This attempt came to the attention of the Rates and Classification Center in Memphis, Tennessee (RCC), which requested additional information from the Postmaster in Leesville. The Postmaster subsequently discussed the matter by telephone with the RCC, and furnished it with copies of Petitioner's publications. Based upon this information, the RCC determined that the publications produced by Petitioner were separate and distinct, and that each required its own second-class authorization to be mailed at second-class rates. In accordance with this finding, a mail classification specialist assigned to the RCC met with Mr. Wise to discuss the case and the options available to the publisher to come into compliance with the applicable regulations. However, efforts to resolve the matter were unsuccessful.

20. On January 12, 1988, the RCC issued a decision pursuant to Domestic Mail Manual § 441.5 revoking Authorizations 145-380 and 695-370 (JX-12).

21. After additional discussions and correspondence concerning options available to Petitioner between its counsel and RCC personnel failed to resolve the matter, on April 13, 1988, the RCC issued a further letter to Petitioner, reaffirming the decision to revoke its second-class authorizations (JX-16). Petitioner appealed this decision by letter dated May 13, 1988 (JX-17) which was forwarded to the Office of Classification and Rates Administration at Postal Service headquarters. On June 7, 1988, that office issued a decision pursuant to Domestic Mail Manual § 441.5 (now § 423.65) affirming the RCC's determination to revoke Authorizations 145-380 and 695-370 (JX-18).

22. Petitioner's appeal from this determination was docketed on June 28, 1988.

CONCLUSIONS OF LAW

The first issue for determination is whether the Director has correctly decided that Petitioner is not entitled to retain its two second-class mail authorizations because of its failure to publish in accordance with its statement of frequency. The issuance frequency of Authorization 145-380 is twice per week and of Authorization 695-370 three times per week (FOF 12). Petitioner makes no mailings under 145-380. It has mailed each of its present nine publications once per week using authorization 695-370. Whether they are considered nine editions of one publication or nine separate publications, Petitioner is not in compliance with the authorized issuance frequency. Therefore, the Director was correct in deciding that neither of Respondent's two publications possessing second-class privileges is entitled to retain them because of failure to publish regularly in accordance with the stated frequency (DMM 422.22 (formerly 421.22)).

The second matter in dispute is whether, as Respondent contends, Petitioner's nine publications constitute nine separate and distinct periodical publications, each requiring a separate second-class authorization or, as Petitioner argues, whether they are nine editions of a single periodical publication requiring only one authorization to be mailed at second-class rates.

DMM 428.21 (formerly 425.21) provides in pertinent part that issues and editions of a second-class publication may be mailed at the applicable second-class rates provided they satisfy the requirements in DMM 428.22 (formerly 425.22) and 428.23 (formerly 425.23). DMM 428.22 imposes numerous requirements relating to issues of publications. DMM 428.23 relates to editions of issues. It provides that individual issues may be mailed at second-class rates in editions such as demographic, morning or evening editions. DMM 428.233, the critical section as to this dispute, provides that editions may differ in content, but not to the extent that they constitute separate and independent publications and that separate publications will not be accepted for mailing as editions of another publication.

Although the types of legal news information contained in eight of the nine publications are generally the same, the specifics within each type relate, in each publication, to a different parish or county and Respondent has stipulated that the content of each is distinct from the contents of others. The ninth publication, Southwest Louisiana Bankruptcy Report, is limited to reports of bankruptcy filings in 14 parishes, including 7 of the 8 covered by the other eight publications. The publications also vary substantially in page numbers and each has a separate subscription price ranging from $6.50 per month for that reporting Vermilion Parish legal news (JE-2) to $28.00 per month for the Daily Recorder reporting legal news of Calcasieu Parish. Until the end of July 1988, each of nine publications carried its individual volume and issue number and date.

The foregoing facts, stipulated by the parties, clearly demonstrate that the nine publications constitute separate and independent publications, not permitted editions of a single publication, for second-class mail purposes. See Mary L. Scarpa, P.S. Docket No. 6/40 (P.S.D. Sept. 25, 1978) wherein the Judicial Officer stated that in the absence of specific guidance in statutes or regulations to determine whether two publications are separate and distinct, one important factor to consider is a comparison of the non-advertising content of the two publications. In the Scarpa case, the non-advertising content of the two publications was approximately 50 per cent different. Based primarily on this significant factor they were held to be separate and distinct publications. In the present case, the percentage of difference in non-advertising content is much greater than in Scarpa.

Petitioner requests a waiver of application fees in the event of a decision here that its nine publications constitute separate and distinct publication requiring separate second-class mail authorizations. The jurisdiction of administrative law judges in this type of proceeding is limited to deciding whether the Director, Office of Classification and Rates Administration, properly denied, suspended, or revoked second-class mail privileges. Our jurisdiction does not extend to consideration of fees, as such, or waiver thereof.

On the basis of the erroneous Postal Service advice it received in 1983 that it could mail its, then, three publications under a single second-class authorization (FOF 14), Petitioner says that traditional notions of fair play, substantial justice and equity should bar the Postal Service from requiring separate permits for each of the nine publications, from asserting claims for revenue deficiencies for past mailings, and from requiring a separate mailing statement for each issue mailed instead of the monthly statement it was permitted to file in the past. In effect, Petitioner is asserting equitable estoppel against the Postal Service.

In this proceeding, I have no jurisdiction in the matters of claims for revenue deficiencies or requirements for filing mailing statements. As to the requirement of separate permits, the Postal Service is not estopped from taking appropriate remedial action in cases involving second-class mail authorizations. See, e.g., Dow Jones & Company v. United States Postal Service, 379 F. Supp. 1167 (D. Del. 1974); O'Shea Publishing Company, Inc., P.S. Docket No. 4/49 (I.D. 1975, P.S.D. 1976). Were equitable estoppel applicable to the Postal Service, one of the elements required for its application is absent here, i.e., Petitioner did not suffer substantial injury from relying on the erroneous advice it received (FOF 14). See, TRW, Inc. v. Federal Trade Commission, 647 F.2d 942, 950-951 (9th Cir. 1981).

The determination of the Director, Office of Classification and Rates Administration, is sustained. The appeal is denied.