Three UPS/MBE Franchisee Groups Now Set for Trial Early 2009

LOS ANGELES (Blue MauMau) - United Parcel Services attorneys will be busy preparing for trials for the next six months thanks to the tenacity of its franchisees and their attorneys. With the Platinum Shield Association (PSA) announcing today that its trial has been set for February 17, 2009, that will put three jury trials on the dockets for early 2009. Another group, the Brown Shield Association (BSA), has two trials scheduled; one for January 20 for franchisees who bought in to The UPS Store franchise after UPS set up its new model, and March 10 for Mail Boxes Etc. franchise operators who later converted to The UPS Store.

Howard Spanier, president of Platinum Shield, today proclaimed, "This is a key victory for our association and other UPS franchisees who have preserved since 2003. All of us look forward to getting UPS in a courtroom and in front of a jury."

The three franchisee groups representing numerous franchisees allege that UPS has used every tactic it could to delay the legal process in getting to this point. Spanier pointed to a statement made on Blue MauMau last week by UPS spokesperson Rich Hallabrin, stating that they knew when they petitioned the California Supreme Court that it would refuse to review it, according to their in-house counsel. Spanier said, "This admission by MBE/UPS proves our association’s contention that this bully corporation has been filing frivolous motions to delay facing a jury and being brought to justice for their destruction of the Mail Boxes Etc. franchise brand.”

The long-standing dispute with UPS stems from its acquisition of Mail Boxes Etc. in 2001 and the subsequent changes the Atlanta-based shipping giant made in franchise agreements with franchisees across the country, as well as adoption of new retail price and profit control schemes. Spanier said UPS failed to live up to promises made at the time of the acquisition of Mail Boxes Etc. (MBE) and never provided franchisees adequate information on tests of its controversial plans to convert MBE to The UPS Store.

“UPS pressured thousands of small mom-and-pop business people who had prospered under the MBE system and induced them into changing to a new identity, The UPS Store, and other alterations in the agreements that benefited UPS and reduced franchisee profitability,” Spanier declared.

Other PSA officials echoed Spanier and expressed renewed hopes to call UPS to task for its behavior. Joe Wightman, who has operated his Manhattan MBE store for 15 years, said, “This makes all the difficulties of the past five years worth it, and we are thrilled to finally have the opportunity to face UPS in court.” Wightman was one of two UPS franchisees who were denied entry to the UPS annual meeting of shareholders in Wilmington, Delaware in May.

PSA has more than 140 members across the U.S., a dozen of whom have experienced UPS legal attacks previously when the billion-dollar shipping enterprise sought temporary restraining orders, alleging that the franchisees, who UPS forced to go independent, were violating UPS trademark rights. In every case, Spanier said, UPS backed down once the franchisees “showed some spirit and refused to yield.” One federal judge in rejecting the UPS restraining order said the maneuver resembled “an ambush."

UPS Looking Forward to the Opportunity

In response to this latest trial date set for PSA as well as the others, UPS spokesperson Rich Hallabrin said they were prepared to go into court and to present their case. "We feel that in each one of these we will prevail. We still maintain that what we did was in the best interest of the network, that it was a sound business decision, and the results since the rebranding certainly bear that out."  

Hallabrin adamantly added, "We also maintain our position that nothing we did in anyway violates the terms of the franchise agreement or franchise law." He insisted that nothing has changed. "The processing just moves forward. We now have court dates and we look forward to the opportunity to present our case."

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