Michigan Enters Negotiations with UPS

Michigan Hopes Settlement Keeps Dim Weight Scanner Issue Out of Courts

LANSING (Blue MauMau) - On Monday, the state of Michigan hosted a meeting with legal and program staff members of United Parcel Services and representatives from Michigan's Agricultural Department and Attorney General's office.

Brad Deacon, Administrative Law Coordinator with Michigan's Department of Agriculture, said, "It was a productive and amicable meeting."

The purpose of the conference was to discuss whether jurisdiction comes under federal or state law on the issue of UPS's laser dimensional measuring devices. Every package shipped from a franchise store, and any other vendor location or online shipping process, is remeasured and re-weighed by the laser machines at UPS facilities. UPS installs and calibrates the devices itself, claiming it comes under federal law and does not required oversight by the states.

But some franchisees have filed claims challenging states to investigate the accuracy of the machines, which they maintain is under state jurisdiction. Franchisees are being back charged substantially for the weight differences on packages claimed by UPS, causing them to "eat" the additional expense which they say cannot be collected from customers. Last May, as a result of this dimensional weight issue, franchisees have joined a proposed class-action lawsuit against UPS, along with other groups who also conduct business with the shipping giant.

According to Deacon, the two parties at Monday's conference exchanged information stating their positions. He explained that at this point they are attempting to negotiate a settlement and because of that he could not get into any details of what may or may not be in it. He said, "We are putting together something to send to them, and in the negotiation process we hope to still reach a decision," stating they hoped to stay out of litigation. "We'll have to evaluate on both our sides what we can agree to," said Deacon. They will propose a settlement agreement which will state certain things that UPS can or cannot do, and things that Michigan will or will not do. He also said UPS expressed an eagerness to work through this with Michigan. According to Deacon, they anticipate that over the next couple of weeks they will see some action and maybe even a conclusion to the matter.

UPS: "States Preempted from Imposing Their Own Regimes"

Although UPS's media office seemed to have its own "jurisdictional" issues when it came to who should comment on the Michigan meeting, Rich Hallibran, spokesman for The UPS Stores, said he had no knowledge of the meeting and pointed back to the Atlanta headquarters. Norman Black, Director of Global Media Services for UPS, said asking what came out of the meeting in Michigan was a fair question, but he did not know anything about the specifics of the conference. Black was quite familiar with the issue, saying they have had a number of meetings with state officials, and he added, "because they come to us asking what our view is on jurisdiction." He said he would have to get the right person from UPS to comment on the Michigan meeting.

But when asked how many states are bringing up the jurisdictional issue with the laser scanners, Black said, "No, we are not going to discuss how many states. This is a question that has been raised and we have no problem whatsoever sitting down and meeting with the right state officials and answering their questions about this." He explained that because they are engaged in national and international trade, they are regulated as a common carrier under federal law, and so it was interstate commerce that they are engaged in. He said, "In just about any instance you could think of in national or federal law, standards apply. He said the states are preempted from imposing their own individual regimes.

When asked if the UPS scanners are accurate, Black said, he would not discuss the issues that have been raised in these lawsuits. He said it is not anything that he could address right now.

Franchisee Pleads for Action

Pez Afrin, a UPS Store franchisee in Michigan, has his own take on the issue at hand. He said, "At what point in time do they want to put a stop to this thing. They are overcharging me and everyone else every week, and no matter what happens we will never be able to recover that money. It doesn't matter whether it's through the state of Michigan or through a lawsuit, we will never be able to recover dollar for dollar what they are taking." Afrin said someone needs to step up and say, "You are not going to use this equipment until it is in compliance."

Editor's Note: An update will be published to this article when comments are received from UPS headquarters in Atlanta regarding the Michigan meeting.

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Previous Articles on Blue MauMau

• States Scrambling on UPS Dim Weight Debacle
• States Respond to UPS Claims