On House Syndication, Inc. v. Federal Express Corp.

MEMORANDUM *

On July 31,1997, Defendant Federal Express (“FedEx”) issued a press release notifying its customers of an impending strike at United Parcel Service (“UPS”) and detailing the measures it was taking to avoid disruptions in service. In that press release, FedEx stated: “As provided in our Service Guide and until further notice, we will not offer money-back guarantees.” (Emphasis added.) The above quoted language did not purport to amend the Service Guide; rather, it purported to be consistent with it. The clear import of the language is that FedEx believed that the UPS strike triggered the force majeure clause in the Service Guide and relieved it of its obligation to pay the Money-Back Guarantee. Customers who contracted with FedEx during the Class Period were, or should have been, aware of FedEx’s interpretation of its Service Guide. Any shipment after the date of the press release must be presumed to have been made with knowledge not only of the Service Guide itself, but also of FedEx’s interpretation of that Guide in the context of the UPS strike.

Because of FedEx’s construction of the Service Guide reflected in the July 31 press release, we hold that FedEx did not…

dissenting.

I respectfully dissent from the majority disposition, because Fed Ex’s newly minted argument that its press release did not purport to amend the Service Guide is simply not supported by the record in this case, and because Fed Ex’s notice of claim requirement could not serve to bar Plaintiffs’ action.

In its Answer to the Complaint, Fed Ex admitted that it “amended its July 1, 1997 Service Guide effective July 31, 1997 to, among other things, suspend its Money-Back Guarantees.” (Excerpts of Record 37). Fed Ex included this admission as an “undisputed fact” (ER 861), and argued it before the district court (ER 333).

Fed Ex continued the amendment theme in its briefs on appeal (Red Brief at 13 and Gray Brief at 3) and at oral argument, until a question from one of the panel members alerted Fed Ex’s counsel that it might be wise to abandon the amendment argument.

The fact is that the Press Release did not reference the force majeure clause in the Service Guide or rely upon it. The *251 Press Release was an ineffective attempt to amend the Service Guide, as reflected by Fed Ex’s subsequent amendment of the Service Guide in accordance with its provisions.

The majority…

concurring.

I fully concur in the portion of the Memorandum affirming the judgment in favor of Federal Express on the excess charges claim. As for the judgment in favor of the plaintiffs on their claim that FedEx breached its money back guarantee, I agree that reversal is required but, respectfully, for a different reason. As I see it, the press release issued on July 31,1997 plainly amended the Service Guide.

The Service Guide provided for a money-back guarantee for late delivery. It also stated how FedEx could amend the Service Guide:

The press release of July 31, 1997 made specific reference to the Service Guide and clearly stated that money-back guarantees would not be offered until further notice. The press release was (1) in writing and (2) authorized by FedEx’s Senior Vice President of Marketing and Corporate Communications, the official designated in the Service Guide to be the only FedEx *250 person empowered to amend the Service Guide. By the terms of the Service Guide itself, a writing authorized by the designated official were the only two prerequisites to amending the Service Guide. FedEx did not have to say “Simon says” or “Mother, may I.” Perhaps the press…