The UPS Store, Tales of Gore

Stories of ownership failure, carnage and regrets about The UPS Store (TUPSS), formerly known as Mail Boxes Etc. OH, and the rebuttals to those horror stories too.

pak mail

are pak mail stores any better?

on June 14th, 2007

UPS Store Lawsuit

Federal Court Accepts Franchisee Victims' Amended Complaint Against United Parcel Service (UPS) PDF Print E-mail
March 22, 2007

L. Michael Hankes, Esq.
63 Commercial Wharf
Boston, MA 02110
(617) 723-1144
Los Angeles, CA

Peter C. Lagarias, Esq.
1629 Fifth Ave.
San Rafael, CA 94901
(415) 460-0100

Federal Court Accepts Franchisee Victims’ Amended Complaint Against United Parcel Service (UPS)

A group of small business owners (The Brown Shield Association, BSA) unites against shipping Goliath UPS, citing omissions, non-disclosure, unfair practices, breach of contract, and predatory practices for franchised locations.

Los Angeles, CA (March 22, 2007) - A substantially revised amended class action lawsuit against UPS was accepted earlier this month by the United States District Court – Central District of California. The amended complaint was filed by more than 220 franchisees of The UPS Store. The franchisees contend that, among other claims, UPS omitted and/or did not disclose relevant information to franchisees opening new The UPS Store locations and those franchisees switching from the MBE brand to The UPS Store brand; UPS made false claims about how well The UPS Store would perform financially; UPS competes and uses information from the franchisee to acquire customers for UPS directly, bypassing the franchisee altogether.

“Corporate greed is still alive and well in America” says Larry Bowdoin, President of the Brown Shield Association (BSA), and a franchisee himself in Alabama. ”UPS likes to call us a minor number of disgruntled franchisees. We’re just one group. What UPS doesn’t want you to ask is how many additional lawsuits from franchisees are there?”.

Bowdoin continued, “No franchisee could have forseen that our biggest competitor would have been our franchisor, UPS itself. There have been many instances of UPS luring away our [franchisee] customers, often with incentives, affecting the franchisees’ profits. UPS makes more money that way, with no regard to our bottom line. The more money per package that they get doing it that way adds up to tens of millions of dollars of extra profit for them. They don’t care that we have rent, employees, health care to pay for out of our own pockets”.

“Had information been fully disclosed regarding profitability, missing test market data, and unfair trade practices, the franchisees would have been able to see that UPS was pulling a fast one on us”, said Bob Strickland, VP of the BSA and a franchisee from Virginia. “This is not a viable business to be in,” he continued. “Instead, we have people filing bankruptcy, drying out their retirement accounts, maxing out their home equity line of credit - it’s a travesty. We’re fighting back for all of the exploitation that UPS has done to us”.

The BSA represents a wide range of franchisees from around the country.

on March 22nd, 2007

Have you ever heard this one...

Has anyone out there heard about this one. When a seller sells a store he chooses to price it based on the subject to royalty amoount and then multiply it by.75. Has anyone heard of this one. Thanks...

on August 13th, 2007


Not Owning A UPS Store :)

on September 19th, 2007


In the fall of 2007, one of UPS’ own, (Do you swear to tell the whole truth and nothing but the truth so help you G-d) said that since the Gold Shield inception that a significant majority of the network saw decrease in sales in the fax, and document services profit centers. This was due to the fact that since 1999 to date individuals and more so small businesses could go to a STAPLES or the likes of and purchase a fax and an adequate printer to satisfy all of their needs. Not only would this save a considerable amount of money but also time by having to go to a UPS store or FEDEX KINKOS or the like of. As the old saying goes in business “TIME IS MONEY”

It certainly looks apparent that UPS /MBE had full knowledge that in 2003 the perception of tapping into the so called lucrative coping sector was nothing more than one of the pieces of the one sided Gold Shield program that has devastated this franchise. Now there is no doubt that shipping along with document services and faxing will do little to make this franchise profitable. What is left to build on? If the major and #1 issue of drop offs is not addressed into profits to this franchise, then the majority will most likely fail or at the least be unprofitable.

Today we know the truth and it would be pretty insulting for any area franchisee to ever make another presentation on the benefits of document services since it is evident that this area of our business has caused negative results for the majority over the last 4 years. What did you discuss at your last network meeting? What will you discuss at your next network meeting? What is left to discuss? We all know now that the term “GOLD SHIELD” was the worst thing that ever happened to the MBE franchise.

That is one hell of a conclusion and the sole reason that the words, “GOLD SHIELD” are never uttered by anyone any longer!

on March 18th, 2008

if i bought a ups store for

if i bought a ups store for $150,000.00 that breaks even.
i would scan the boxes it would take an employee approx 2 hours a day
i would as the store owner make 600 x 1.10 x 25 days a month approx $15,000 per
month minus an extra employee cost at $1,500 to scan and royalties at $1,100.00

i would net over $10,000 per month.

please poke holes in this theory as i want to buy a store asap.


on May 4th, 2007

Yet another store closing

My husband and I opened our store nearly three years ago. This week we will be closing it and just walking away suffering, of course, a huge loss. The reason, as you are all aware, is we cannot continue to fund the lies told to us by UPS. Our The UPS Store franchise was totally misrepresented to us by our area franchise director (as he likes to call himself). The last thing we needed was another hand in our checking account. Seems he has lined his pockets with cash for every contract/lease he got us into although he states he was "acting in our best interests". All can rest assured that we will never again in our lifetime be a UPS customer. I would sooner walk my packages to their destination than to give up another of my hard earned dollars to UPS.

on March 24th, 2008

What goes around comes around

UPS/MBE have 5 legal battles to contend with all at the same time and all having to do with the MBE/UPS STORES.
1-IAMCO GROUP coming to a head
3-platinum sheild individual litigations moving forward
4 UPSOVERCHARGEDME.COM moving forward and gaining huge number or participants
5-Brown Sheild GROUP litigation in full flight
6-Numerous other personal litigations in process
7- Growth of franchise drastically diminished and renewals closing instead
8-ASO (INDEPENDANT PACK AND SHIP) continuous discontent growing at an alarming rate with UPS
9- FEDEX gaining steady ground at UPS expense
CONCLUSION: BROWN STARTING TO GO DOWN! That's what happens when monkies disguise themselves as gorrilla's!

on December 26th, 2007



on August 14th, 2007

CEO Mike Escew of UPS on American Idol

I missed this episode of American Idol but someone on YouTube managed to tape it. So without further comment, here is the CEO of United Parcel Service, Mike Escew, appearing on American Idol to croon and persuade.

on August 21st, 2007

ups co-op

MBE/ups stores has taken all interest from my advertising co-ops. They have taken this income from every co-op in America I suspect. It is money they have taken even though they state/imply and put in writing that it belongs to the co-op .

 I urge all store owners/ co-op owner members and thier counsel to review your co-op contract which states "all monies will be placed in interest bearing accounts which will be used to offset bank charges" and to also review your accounting of co-op funds. I recieved an email fro my UPS rep stating "they never intended for the co-ops to recieve the interest,just not to make them pay any fees"  In a world where banks do not make charges on business accounts they still take this money from the co-ops and even acknowledge thier intent was to never pay the money out.

What a deal!!!

Posted by mrredd on January 4th, 2008

Is the Brown Board of UPS represented by an attorney

Is the Brown Board Association of The UPS Store Franchise represented by an attorney and what percentage of The UPS Stores are members of the Brown Board? Anyone know?

on July 13th, 2007

Tales of Gore Dedicated to the UPS Store

There is so much posting on the UPS Store (most not nice) that we've discovered a new glitch that we never knew we had. Recent comments towards the end of the UPS queue are not queued. We're fixing this ASAP though.

So, it is best to move The UPS Store soiree to a better venue. There is a new forum called "The UPS Store, Tales of Gore" that is dedicated completely to gripes and horror stories from the UPS Store franchisees and thought leaders.

Please post your UPS stories, Mail Boxes Etc. and related mail service franchise gripes here.

Mr. Blue MauMauCommunity Umpire

on February 28th, 2007

UPS Stores For Sale

I have seen UPS Stores on sale on Ebay for 25 to 50% of what a new store would cost. Are these offers for real? Is it really that bad?
I am considering one of these offers, am I totally crazy?

on September 24th, 2007

The trials and tribulations of being a UPS Store Owner

What a sad day it has become has to resort to nickel and dimeing franchises to the point of bankruptcy. The saddest thing about this network is what it could have been and not what it is. There is no turning back now. What high hopes I had when I started this but how naive I was.

on February 28th, 2007

The UPS Store, a typical day........

This video pretty much sums it up if you're looking to buy a UPS Store.

on July 15th, 2007

co-op interest

We all should be looking at what aour money is being used for, we shopuld be asking for a detailed accounting as to how our money is being spent. DO we know that all our ad money that is paid every month is being used for The UPS Stores only???

on January 7th, 2008

Recap: KRI Says The UPS Store #1 Retailer

...will the old thread that started under the Canby Research Story be lost to new posters? - Guest

That thread will remain. The discussion is just getting too robust for the remarks section of the story. Please post the quote from the original story that you are replying to (like the above example) for clarity.

For those readers who are new to this ongoing discusion, the story and discussion thread that is being referred to is a Kanbay Research Institute study picked up by the mainstream media that was immediately challenged here - "UPS Store Considered Most Competitive Retailer." The wording is ambiguous said many of you. Most competitive retailer for the franchiser or for the individual franchise units?

KRI replied to the Blue MauMau community (see UPS Shows Advantage of the Franchising Model) saying, "the purpose of the study was to provide business leaders -- primarily CEOs of multi-store chains -- with innovative ideas about how to build competitive advantage."

You can see the original discussion thread these two stories created on The UPS Stores  by clicking the links.

on February 28th, 2007

Want to take a Bath in UPS waters?

We really took a bath and Brown didn't furnish any towels or water softener!
I feel sorry for those people who think that UPS is going to share any of their profits with them.

on February 28th, 2007

2006 ONLY

Aron Fliman 35 Morris Rd Tenafly, NJ 07670 201-894-8848
MG Anthony Enad 4381 Foxford Way Dublin, CA 94568 925-828-4094
Tom & Mary Lott 8829 Cypress Wood Ave Las Vegas, NV 89134-0315
Joel Ehrenberg 4049 Broadway New York, NY 10032
Michael Williams 5116 S Narcissus Ave Broken Arrow, OK 74011 918-449-9195
Richard Smucker 9081 Maral Trail Centerville, OH 45458-3629 513-885-7387
Chris Parsons 5209 NW 122 Terrace Oklahoma City, OK 73162 972-899-1703
James Nieman 4230 S Raymond Rd Waterloo, IA 50701 319-504-5785
Michael Perko 279 East 280th Street Euclid, OH 44132-1307
Lyle Johnson 5314 El Tejano San Antonio, TX 78233-5509 210-656-1782
Donald Austin 1900 SW 11th Avenue Austin, MN 55912 507-433-1468
George Tatum 46-428 Haiku Plantations Drive Kanehohe, HI 96744 808-235-8386
Yvonne Cooper
Charles Conley 12802 Stardell Whittier, CA 90601-2435 310-696-4491
Catherine Thomas 5136 Castor Avenue Philadelphia, PA 19124-1741 215-289-3223
Lewis Johnson II 532 SW Rimrock Apt 18 Redmond, OR 97756-1953 503-548-1413
Karl Fortsch 6 Shannon Court Somerset, NJ 08873-5017 908-846-7180
Tom D Weedman 7620 Toltee Dr N Little Rock, AR 72116-4586 501-834-1033
David A Derus 2227 W Vine St Lodi, CA 95242-3725 209-334-4073
Patricia Craig
Gil McDougal 6715 Limerick Ct Indianapolis, IN 46250-4415 317-842-7129
Martin Senoff 381 Gerry Rd No. Brunswich, NJ 08402 908-297-5567
Irene Sanford 88700 Shoreline Loop Florence, OR 97439-9171 503-997-2336
Dennis Meeks 1335 E Vine Ct Visalia, CA 93292-7352 209-732-6674
Stephen Christo 4310 Braysworth Dr Houston, TX 77072-1822 713-933-5897
Walt/Lynn Paton 8225 Oak Knoll Drive Granite Bay, CA 95746-9373 916-791-4404
Dale Martinez 1875 N Birch Avenue Reedley, CA 93654-8701 209-638-1959
Michael Moran 1316 NW Sheridan Rd Lawton, OK 73505-5212 405-351-2015
Michael Moran 1316 NW Sheridan Rd Lawton, OK 73505-5212 405-351-2015
Glenn Sturgis 67 Skyline Dr Salem, VT 06420-4108 203-859-1584
Hillal Baradehi 4956 Seaford Circle Irvine, CA 92604-2424 714-552-6375
Craig/Marcia Hansen 9553 Tivoli Circle Cypress, CA 90630-3570 714-995-3257
Zaheer Azam 18506 W Oceana Ct Canyon Country, CA 91351-3440 805-251-8208
Mary Dunseith #5 Berrypick Woodlands, TX 77380-1390 713-364-8936
Jeffrey Mullen 13284 Tiverton Rd San Diego, CA 92130-1031 858-259-6145
Sharon James 930 2nd Street Natchitchoes, LA 71457-4715 318-356-0390
Christina L May 4605 Jessica Lane North Royalton, OH 44133-5267 216-582-5995
Waldon Louie 216-5th Ave San Francisco, CA 94118 415-752-5627
Patrick/John Weir 416 E 81st Street #C New York, NY 10028-5892 212-772-0239
Roger Moore 11485 Clinton Bar Road Pine Grove, CA 95665-9722 209-223-9377
Denise C Taylor 314 Shadeland Ave Drexel Hill, PA 19026 610-394-6775
Arthur Brestlin 155 Ravenhurst Ave Staten Island, NY 10310 718-447-2474
David Kopchak 503 C-4 West Lakeshore Dr Port Clinton, OH 43452 419-734-4832
Luigi Giunta 392 E 3rd St Brooklyn, NY 11218 718-431-8244
Jeffrey Collard 1609 E Firmin St Kokomo, IN 46902-2418 317-868-0283
Reymundo Puentes 12400 Rojas Space 151 El Paso, TX 79928 915-858-9869
John Cummo 29 Shattuck Rd Hadley, MA 01035 415-549-1844
Scott Gougis 465 E Honors Pt Court Slidell, LA 70458 985-643-9329
Frank Scarso 31 Dell Court Staten Island, NY 10307 718-227-6026
Anthony Jarvis 9501 Tamar Trail Fort Wayne, IN 46825 219-489-7713
Lillie Cain 4800 W Rasmussen Rd Ludington, MI 49431 231-845-2565
Sam Molinaro 4214 Fox Hill Dr Sterling Heights, MI 48310 586-604-4990
Steve C Busch 14025 Country Rd 14 Perryton, TX 79070 806-435-3208
Arthur Brestlin 155 Ravenhurst Ave Staten Island, NY 10310 718-447-2474
Rey Martinez 19 Paseo Viento Rancho S Margarita, CA 92688 949-589-2360
Larry Davis 23729 S Southview Dr Claremore, OK 74019 918-343-2660
Issam Mishu 821 Melrose Place Knoxville, TN 37916-3426 615-693-1008
James Gerlach 13900 NE 31st Pl Bellevue, WA 98005-1881 239-254-9503
Cathleen Paguio 3709 W Ellery Fresno, CA 93711
Benjamin Amos 377 Santa Clara Avenue #312 Oakland, CA 94610 510-891-9832
Shekhar Gosai 1916 Interface Lane Apt #14 Charlotte, NC 28262 704-921-1572
Ahaji Amos 7450 Overbrook Dr St. Louis, MO 63121 314-385-0099
Ali Altai 22045 Newbridge Dr Lake Forest, CA 92630-6512 714-770-4941
David Chaffin 809 Lake Meadows Circle Rockwal, TX 75087 903-450-1446
Medina Sadiq 369 East 148th St Bronx, NY 10455
James Silva 937 Nemeth St Bohemia, NY 11716-2120 516-563-6961
Joseph Smidt 258 Middleton Rd P.O. Box #258 Boxford, MA 01921-0258 508-887-5035
David Smith 4924 N Melrose Ave Tampa, FL 33629 813-784-7249
Juanita Greene 4575 Alridge Dr Memphis, TN 38109
Paul Wehrs 1984 Richway Land SE Owatonna, MN 55060 507-446-8646
Bradley Beilinson 4207 N Lost Springs Dr Agoura Hills, CA 91301-5328 818-880-1246
Gerald Reed Route 1 Box 1234 Hermiston, OR 97838-9530 541-567-9352
Russell Kawano 2171 Crosscreek Lane Boise, ID 83706-6706 208-343-8881
Mona Khoury 12208 Fernando Court San Diego, CA 92128-1216 858-673-1643
Shabbir Azam 9420 Reseda Blvd #3 Northridge, CA 91324 805-298-1272
Chang Nim Kim 2885 W 7th Street Los Angeles, CA 90005-3907 213-385-7272
Jennifer Boggs 5071 State Rd 252 Brookville, IN 47012 765-647-1392
James Silva 350 3rd Ave New York, NY 10010-2310 212-599-1361
Janet Reddington 3029 Fir Oaks Dr SW Albany, OR 97321-3553 541-928-6601
Carlos Garcia 601 Pelham Parkway North #207 Bronx, NY 10467 718-654-6062
Keith Russell 4107 Crest Ridge Rd Irving, TX 75061-9115 972-986-0105
Keith Russell 4107 Crest Ridge Rd Irving, TX 75061-9115 972-986-0105
James Gordon 369 Scotland Road South Orange, NJ 07079-3019 201-761-0400
Terence Mitchell 195 Montague Street Brooklyn, NY 11201 718-722-5353
Sukhi Sandhu 1346 Southern Oak Ave Simi Valley, CA 93063 805-955-9166
Dana Houser 4020 C Street Lincoln, NE 68510 402-327-9375
Joyce Wagner 812 Scruggs Road Meridian, MS 39301 601-482-6649
Richard Schaefer 34 Windsor Court Delmar, NY 12054-4304 518-439-6602
Kent C Skurkey 20100 Lorain Rd #504 Fairfield Park, OH 44126-3432 440-895-9968
Vincent Natelli 5 John F Kennedy Drive Blauvelt, NY 10913 845-359-9567
Michael Foscone 842 Sylvan Rd Lancaster, PA 17601 717-672-0913
Charles Wilson 208 Wellington Ct Belair, MD 21014
J Barre Conley 1 Doug Dr Shawnee, OK 74804-1114 405-273-1810
Pratibha Patel 217 Harvest Row Ct Cary, NC 27513 919-468-8119
Jerome Salerno
Bill Heard 5754 Greer Loop SW Albuquerque, NM 87105-6760 508-877-3839
Carmen Parra 1443 Papago Place Nogales, AZ 85621 602-287-5406
Salah Kidwai 202 East Selwood Ln Columbia, SC 29212-8106 803-781-5194
Stanley Hoover 1410 Regatta Lane Monument, CO 80132 719-264-0081
James Kiser 111 Tallassee Trail Leesburg, GA 31763 229-759-8189
Sheila Conway 4213 NW 148th Street Oklahoma City, OK 73134
Paul Lanning 1415 Melbourne Drive New Haven, IN 46774-2649
Thomas Dance 3818 Cedar Springs #101-407 Dallas, TX 75219 214-683-8466
Vincent Natelli 5 John F Kennedy Drive Blauvelt. NY 10913 845-359-9567
Peter Tan 751 N El Camino Real San Mateo, CA 94401 650-340-7167
James Silva
Vincent Natelli 5 John F Kennedy Drive Blauvelt, NY 10913 845-359-9567
Kevin McMahon RR4, Box 200 Putney, VT 05346 802-387-2581
Patrick Perry 22 Albany Circle Beverly, MA 01915-1267 508-927-3848
Herbert Saywitz 1621 E Mission Hills Rd #202 Northbrook, IL 60062 847-564-1317
Robert Smith 100 Pheasant Drive Marietta, GA 30067 770-956-7658
Jonathon Bronsdon 15 North St Westford, MA 01886-1244 978-392-9367
Mark Bilodeau 149 Lake St Auburn, ME 04210 207-783-8261
Michael Wiginton 3912 Brave Trail Kennesaw, GA 30144-5015
Ravindra Mallavarapu 916 Eale Ridge Rd Cedar Falls, IA 50613 319-277-2048
Robert Hayes 4 Rockwood ST Walpole, MA 02081-4110 508-668-4801
Nancy Guy 1240 W 70th Street Kansas City, MO 64113 816-444-5174
Stuart Silbert 24 Turning Mill Rd Sharon, MA 02067 339-364-0225
Stuart Silbert 24 Turning Mill Rd Sharon, MA 02067 339-364-0225
Karl Waller 4812 Granada Dr Yorba Linda, CA 92886-2853 714-693-1062
Warren Buck 12823 Vidorra Vista Dr San Antonio, TX 78216 210-408-6777
Gary Nicodemus 5206 David Street Indianapolis, IN 46226-1730 317-545-8520
Brian Berry 6005 Northridge Rd Columbia, SC 29206 803-782-1400
Gary Pierantoni 74 Genesee Blvd Atlantic Beach, NU 11509-1314 516-239-1459
Michael Paternoster 124 Ridgewood Road Glastonbury, CT 06033 860-659-4341
Don Bingham 1710 Big Horn Houston, TX 77090-1865 713-444-4890
Tulsidas Patel 6 Hitching Post West Hills, CA 91307-1132
Judith Adamson 1707 Boswell Dr Laramie, WY 82070-8115 307-742-7534
Sue Bean 3003 Cardinal Ridge Dr Greensboro, NC 27410 336-664-6365
Norman L Anderson 7020 Chad St Anchorage, AK 99518-2055 907-344-1334
Steven Johnson 26 Twisted Birch Pl Ct The Woodlands, TX 77381-4526 281-292-6256
Mail Boxes Etc., Inc.
Jayesh M Patel 8901 Windjammer Drive Raleigh, NC 27615 919-844-1200
James/Carol Cotcher 1034 Emerald Bay Rd So Lake Tahoe, CA 96150 530-542-1943
Louis Jordan 150 Lombard St Apt 208 San Francisco, CA 94111
Robert W Courtney 1007 Oberlin Drive Columbus, OH 43221-1627 614-451-8931
Christopher Burrenll 111 Duncan Road Greenville, SC 29617 864-294-1921
Peter Sham 65 Gordon Corner Road Marlboro, NJ 07746-1119 908-972-2521
Rick Biggs 382 Upper Valley Rd Rochester, NY 14624-2308 716-247-3979
Jim J Rogodinski 5 Tower Hill Road Hinsdale, NM 03451-2534 603-336-7138
Gregory Rosnow 6188 Edmonson Ave NE Monticello, MN 55362 763-295-3299
Charles Morrison PO Box 1053 Port Isabel, TX 78578 956-963-6344
Patrick Gallagher 133 School Lane Springfield, PA 19064-2518 610-328-0486
Dennis Marino 5810 Arbor Walk Lane Tampa, FL 33624 813-968-5089
Kenneth Alford 2109 Scout Ln Mission, TX 78572 956-519-8176
James Humbert RR1 Box 4095 Fairhaven, VT 05743 802-265-4725
Michael McNulty 34 Sherbrooke Rd Lindenhurst, NY 11757 631-957-7989
Anil Gosalia 11914 Mission Rd Leawood, KS 66209 913-338-2057
James Lyons RT 2 Box 69A Genesee, ID 83832-9534 208-285-1413
Grace M Moore 165 Chestnut Valley Drive Doylestown, PA 18901 215-230-3360
Patrick Weir 320 E 91st Stret #3-FW New York, NY 10128-6027 212-348-8771
Brian Laws 2216 Lambert Dr Nampa, ID 83686-7297 208-463-0230
Kimberly Bond
Janyce Hutchinson 3234 South Newcombe St Apt 5201 Lakewood, CO 80227 303-378-7968
Howard Spanier 1043 Ashford Court Westlake Village, CA 91361-2001 805-496-4853
Sam Morgan 2 Alhambra Ct Pueblo, CO 81005 719-566-8687
Jose Escudero
Jay Friedman 227 Momar Dr Ramsey, NJ 07446
Paul Barry
Ron & Robert Rieder
George Grayeb 4495 Fox Hunt Court NE Ada, MI 49301 616-956-7692
Alexandra Torres 72-42 61 Street Glendale, NY 11385 718-381-3186
Mike Soliman 30762 Calle Barbosa Laguna Niguel, CA 92677-5506 714-249-9075
Bart Black 3276 Old Chisholm Rd Apt #1101-E Florence, AL 35630-1076 205-760-9452
Tim Horvath 2057 Bel Air Star Pkwy Sarasota, FL 34240 941-377-2504
Kathryn Stoddart 1611 West 63rd Street Excelsior, MN 55331-9001 612-474-6111
Leroy Skipper 5371 Aqua Street Columbus, OH 43229-9331 614-891-4448
John Raposo 157 Albion St Somerville, MA 02144-2619 617-666-0534
Lance Brown 407 Meriwether Paragould, AR 72450 870-239-4589
William Weir 9201 Vagas Rowlett, TX 75088 972-463-4389
R Michael/Barbara Durham 11210 Hylander Dr Houston, TX 77070-1336 713-376-7197
Jackson D Del Rash 8220 State Rd 84 Suite 301 Davie, FL 33324-4625 305-475-1653
Fernando Rey 8220 State Rd 84 Suite 301 Davie, FL 33324-4625
Daniel Wilson 12922 Bellaire Thornton, CO 80241 303-252-1727

on July 20th, 2007

The UPS Store

Nothing But FRAUD! FRAUD! FRAUD! Run like hell if you want to keep your 401k, house,cars, wife, kids!

on July 20th, 2007

Buying UPSS

Don't buy any franchise with an FOC which allows the franchisor to come in after 10 years and buy your entire business for the then current market value of the fixtures in the store.

In otherwords you pay $200k for a store and in 10 years they can buy it for what your fixtures are worth maybe $10-20k if you are lucky.

on August 25th, 2007

The UPS Store 2007 Uniform Franchise Offering Circular

EXCLUSIVE: The UPS Store 2007 Uniform Franchise Offering Circular (UFOC) is now online at Blue MauMau.

on May 23rd, 2007

Dallas Business News ---The UPS Store

I don't think newspapers are circulated and read to the great degree that they were just ten years ago and I, personally, believe that this is a great shame. Reading and digesting what one has read does much more for the brain than listening to an attractive woman or man tell you about the day's news. We are diverted by looking at the clothing, or the hair, or the eyes, etc.. of the "actor" who is speaking and brainwashed by their good looks.
I post on this because we have Dale insisting that publicity concerning ZEE --ZOR problems that become public hurts the ZOR and might sink his ship, etc... and he has to know that this isn't true.
ZEES get 1% of the publicity and PR that the ZOR puts out there every day. The only publicity ZEES get is normally in the Business Sections of the papers on the Internet, etc...
While this is excellent coverage of the facts by Katherine Yung, Dallas Business, we know that the business news is read selectively and not as widely read as the rest of the paper by the public. While it was excellent coverage of the facts by Janet Sparks in the March 2007 Franchise Times ---who is it that reads these business articles ----not the same people who are customers of Quiznos and UPS, I'm sure.
You would have to have a front-page article or primetime investigation, etc.. to really damage either of these names in the eyes of the public ---- who have short memories, and Americans would still frequent their local Quiznos and UPS store anyway and the Zor wouldn't be hurt.

on April 8th, 2007

The UPS Stores = BAMBOOZLED!!!

Also, if you have rent, (around #3,500.00 per month) a small business loan (Monthly Payment approx. $2,500.00 per month, you're already have been BAMBOOZLED! You're lost it all!! DO NOT I REPEAT, NO DO NOT buy a UPS Store!!!!

on September 10th, 2007

The UPS Store Dallas Morning News

Editor's note - To our guests, please be aware that copying and pasting an article in its entirety from copyrighted material is an infringement of copyright law. I have cut this article to the more interesting parts and provided a link to the original story in the Dallas Morning News. Readers can clip parts of a news article, make a comment and link to the original story. That's fair use. - Mr. Blue MauMau

UPS Store owners all over the country are packing it in, including 10 in the Dallas-Fort Worth area in the last two years. And the numbers could grow, raising alarms about a possible franchise fiasco.

Mike Gorlano 50, couldn't get back half of what he paid for his UPS Store in Carrollton. He's living off his savings while looking for a new career. Andy Weir, 43, faces thousands of dollars of debt after closing his UPS Store in Richardson. The problem stems from an unusual situation: The stores can't compete with United Parcel Service Inc.'s Web site. Many current and former franchisees accuse the package delivery giant of using the Internet to take away their customers. Most of the franchisees that failed are mom-and-pop operations that sank all of their savings into their stores. The owners say UPS is destroying their livelihoods and retirement dreams.

...To fight back, a group of 220 current and former franchisees from around the country, including a few from the Dallas area, is suing UPS and its franchisor, Mail Boxes Etc., accusing them of breach of contract, fraud, unfair trade practices and other actions. 'In 28 months in this business, I don't see an opportunity to survive,' says Joaquin Rosal, a UPS Store franchisee in Coppell.

...The fallout could tarnish the reputation of a franchise that consistently wins high marks from Entrepreneur magazine and others.  

on April 8th, 2007

Another Lovely Lawsuit with UPS

Exhibit A
2007 Sep-24 PM 06:18
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Plaintiffs allege all facts relating to themselves and their experiences based
on personal knowledge and all facts relating to other allegations based on
information, belief and the investigation of their counsel as follows:
1. This is a proposed class action on behalf of all persons and entities
within the United States who have shipped packages with and received invoices
from defendant United Parcel Service (“UPS”), including (i) persons and entities
owning and operating UPS franchises across the United States under the Mail
Boxes, Etc. and UPS store brands; (ii) persons and entities owning and operating
“Third Party Retailers” of UPS shipping services (which includes Authorized
Shipping Outlets, UPS Alliance Locations located in Staples and Office Depot
retail locations, and Commercial Counters.); and (iii) persons and entities who
have accounts with UPS. Plaintiffs and members of the Class are referred to herein
as “Shippers." Collectively, the proposed Class of Shippers includes
approximately 10,000 package shipment centers and over one million account
individually and on behalf of all
persons similarly situated,
Civil Action No: 5:06-cv-04686-IPJ
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2. The action arises from UPS’s measurement system used to determine
the “billable weight” of a package and for assessing “large package surcharges” on
certain packages. UPS systematically rebills Shippers based on the dimension of
the packages as measured by UPS’s laser measuring or camera scanning devices
(hereafter, “the Measurement Overcharge Scheme.”).
3. The measuring devices are generically referred to as Multiple
Dimension Measuring Devices.
4. Prior to January 1, 2007, the “billable weight” UPS charged Shippers
for ground delivery was based on a package’s “package measurement” (expressed
in inches as the package’s length plus girth) or actual weight. Since then, UPS has
used a “dimensional weight” rate structure for all shipments including ground,
which bases “billable weight” on the greater of “dimensional weight” (determined
by multiplying length times width times height, and dividing by a constant) or
actual weight.
5. After a Shipper has measured a given package to determine its
“package measurement” or “dimensional weight,” determined the package’s
“billable weight,” and assessed “large package surcharges” when warranted, it
calculates its shipping cost for the desired services. The package then goes to UPS
for shipping.
6. When the package arrives at a UPS hub at some point during the
shipping process, UPS “remeasures” the package using its Multiple Dimension
Measuring Devices. It then charges the Shipper for the difference between UPS’s
measurement and that of the Shipper.
7. UPS’s Multiple Dimension Measuring Devices measure the
dimensions of a package in a different fashion from that which UPS mandates that
Shippers use in its “Rate and Service Guide,” which is incorporated by reference in
UPS’s contracts with Shippers.
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8. In its Rate and Service Guide, UPS informs Shippers to measure the
dimension of packages by measuring along the package’s edges – even when the
packages are irregularly shaped and even when the package “bulges.”
9. According to the “Rate and Service Guide,” a measurement of .49
inches is to be rounded down, and a measurement of .50 inches is to be rounded
up. Accordingly, a false reading of as little as .01 inches can result in an
additional inch being added to a measurement. Each additional inch is
significant in that, in calculating “dimensional weight,” UPS uses the “cubic size”
of the package – which is length x height x width. Thus, while an 11 x 11 x 11
package has a cubic size of 1332 cubic inches, a 12 x 12 x 12 package has a cubic
size of 1728 inches. Likewise, an additional inch is significant for those packages
measured in terms of length plus girth, or: Length + [(2 x W) + (2 x H)]. Thus,
while an 11 x 11 x 11 package has a length plus girth “package measurement of 55,
a 12 x 12 x 12 package has a “package measurement” of 60.
10. On information and belief, the “tolerances” of the Multiple Dimension
Measuring Devices used by UPS are far greater than .01 inches, and are as high as
.25 inches. That means that if a Shipper properly measures one side of a package
at 11.25 inches, the Shipper would “round down” to 11 inches pursuant to UPS’s
Rates and Services Guide; on the other hand, UPS’s device might record a
measurement of 11.5 inches, which would then be “rounded up” to 12 inches.
11. Moreover, while Shippers are instructed to measure along the edges of
the package, on information and belief the Multiple Dimension Measuring Devices
measure along the highest points of each dimension; thus, if the package has a
“bulge,” the Multiple Dimension Measuring Device will record a higher
measurement than the measurement accurately recorded by the Shipper in keeping
with the Rate and Service Guide.
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12. UPS knew that the Multiple Dimension Measuring Devices are
inaccurate and not reliable.
13. Because of UPS’s systematically inaccurate measurement system,
final bills or account reconciliations from UPS contain improper adjustments that
impose higher charges for shipping on Plaintiffs and members of the Class.
14. In this lawsuit, Plaintiffs seek injunctive relief to remedy UPS’s
inaccurate and unfair measurement practices, and damages to compensate
Plaintiffs and the Class for the losses they have suffered.
15. Plaintiff Persepolis Enterprise, is a Michigan corporation. It operates
UPS store No. 2742 pursuant to a franchise agreement with Defendant. Plaintiff
Peresopilis Enterprise has repeatedly notified UPS of improper dimension-based
price adjustments within 6 months of receiving the improper adjustments, and UPS
has often refused to correct the adjustments.
16. Plaintiff Berg Design Inc. (hereinafter, “Berg”) is an Oregon
corporation. Berg repeatedly notified UPS of improper dimension-based price
adjustments within 6 months of receiving the improper adjustments, and UPS has
often refused to correct the adjustments.
17. United Parcel Service, Inc. – Ohio (“UPS-OH”) is an Ohio
corporation with its principal place of business at 55 Glenlake Parkway NW,
Atlanta, Georgia 30328. At all times relevant hereto, UPS-OH provided package
pickup and delivery services in the central and western region of the United States.
It is referred to collectively, with the other United Parcel Service, Inc. entities, as
United Parcel Service, Inc., or “UPS.”
18. Defendant United Parcel Service of America, Inc. (“UPS-America”) is
a Delaware corporation with its principal place of business at 55 Glenlake Parkway
NW, Atlanta, Georgia 30328. At times relevant hereto, UPS-America owned and
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operated businesses providing pickup and delivery services for the transportation
of property. It is referred to collectively, with the other United Parcel Service, Inc.
entities, as United Parcel Service, Inc., or “UPS.”
19. Defendant United Parcel Service, Inc. (“UPS-New”) is a Delaware
corporation with its principal place of business at 55 Glenlake Parkway NW,
Atlanta, Georgia 30328. UPS-New is the parent corporation of and the successor in
interest to UPS-America. It is referred to collectively, with the other United Parcel
Service, Inc. entities, as United Parcel Service, Inc., or “UPS.”
20. United Parcel Service, Inc. – New York (“UPS-NY”) is a New York
corporation with its principal place of business at 55 Glenlake Parkway NW,
Atlanta, Georgia 30328. At all times relevant hereto, UPS-NY provided package
pickup and delivery services in the eastern region of the United States. It is referred
to collectively, with the other United Parcel Service, Inc. entities, as United Parcel
Service, Inc., or “UPS.”
21. Pursuant to 28 U.S.C. § 1332, as amended by the Class Action
Fairness Act of 2005, this Court has subject-matter jurisdiction over this
nationwide class action because the matter in controversy exceeds $5,000,000,
exclusive of interest and costs, and is a class action in which a member of the Class
of plaintiffs is a citizen of a state different from the defendants. See 28 U.S.C.
§ 1332(d)(2)(A). In addition, this Court has subject matter jurisdiction over Count
I of this Complaint pursuant to 28 U.S.C. §1331 and 18 U.S.C. § 1964(a) as a
federal question arising under RICO.
22. This Court has personal jurisdiction over the Defendant, and venue is
proper in this district, pursuant to 28 U.S.C. §§ 1391(a) and (c). Venue is also
proper in this district because many Class Members reside and/or do business in
this district.
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A. UPS and Its Relationship With Shippers
23. Founded in 1907 as a messenger company in the United States, UPS
has grown into a $42.6 billion dollar corporation by focusing on the goal of
enabling commerce around the globe. Today UPS is a global company with one of
the most recognized brands in the world. It has become the world’s largest
package delivery company and a leading global provider of specialized
transportation and logistics services. It manages the flow of goods, funds, and
information in more than 200 countries and territories worldwide.
24. In 2001, UPS ventured toward retail business by acquiring Mail
Boxes Etc., Inc., the world’s largest franchisor of retail shipping, postal and
business service centers. Within two years, approximately 3,000 Mail Boxes Etc.
locations in the United States re-branded as “The UPS Store” and began offering
lower UPS-direct shipping rates. The stores remain locally owned and operated,
and continue to offer the same variety of postal and business services.
25. Individuals who do not maintain their own accounts with UPS
typically ship their packages through either a franchisee or a Third Party Retailer.
In that circumstance, the individual deals only with the franchisee or Third Party
Retailer; the franchisee in turn deals with UPS and is UPS’s customer, or
26. If an individual takes a package to a UPS Store that is not a drop off
(pre-paid) package, the individual is then billed by the UPS Store. If an individual
ships a package at the UPS Store, the individual is the Franchisee’s customer. The
franchisee in turn is UPS’s customer (or “Shipper”) and UPS bills the franchisee.
27. Likewise, if an individual takes a package to a Third Party Retailer
and chooses to ship via UPS, the individual is then billed by the Third Party
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Retailer. The individual is the Third Party Retailer’s customer, and the Third Party
Retailer is the Shipper. UPS bills the Third Party Retailer.
28. Finally, if an individual or entity has an account with UPS, that
individual is the Shipper. The Shipper weighs and/or measures the package, and
places a shipping label on the package that is generated using software provided by
UPS. UPS then bills the accountholder at regular intervals for all packages
shipped during a particular time period.
29. With respect to all Shippers, UPS’s services are provided as stated in
the applicable “UPS Retail Rate and Service Guide.” (“Rate and Service Guide.”)
30. In addition, UPS’s relationship with franchisees and with Third Party
Retailers is governed by a document called UPS Tariff/Terms and Conditions
(“Terms and Conditions”) (formerly two separate documents). The latest versions
of the Rate and Service Guide, and the Terms and Conditions, can be found at
B. UPS’s Billing Methods Involve Consideration Of Both The Weight And
Size Of A Package
31. As detailed below, in order to assess the appropriate charges for
shipping a given package, the Shipper must determine, among other things, the size
and weight of a package.
32. In each case, the cost of the shipment depends in part on the “billable
weight” of the package.
33. In calculating the billable weight for all domestic and international
shipments, Shippers are instructed to first determine actual weight of the package,
rounded up to the next full pound.
34. Next, for all air shipments (domestic and international) and for
ground shipments (sent after January 1, 2007) where the “cubic size” of the
package is 5,184 cubic inches or greater, the Shipper must also determine the
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“dimensional weight” of the package, which is defined as “the amount of space a
package occupies in relation to its actual weight.”
35. To obtain the “dimensional weight,” the Shipper must first calculate
the “cubic size” of the package, which is L (length) x H (height) x W (width).
36. The “dimensional weight” for domestic shipments is defined as the
cubic size divided by 194. For international shipments, the “dimensional weight”
is defined as the cubic size divided by 166.
37. The “billable weight” is the greater of the actual weight or the
“dimensional weight” (with the caveat that for ground shipments where the cubic
size is 5,184 cubic inches or less, the “billable weight” is always the actual
38. All other things being equal (i.e., the type of service, and the zones of
travel), the greater the “billable weight,” the higher the Shipper’s cost for transport.
So, to take one example from page 24 of the “Rate and Service Guide,” a package
shipped “Next Day Air Early A.M.” with a “billable rate” of 31 pounds priced at
Zone “108” would cost the consumer $161.10, whereas a 32 pound package would
cost $164.00.
39. Prior to January 1, 2007, the Rate and Service Guide required that
customers shipping by UPS ground compare actual weight to its “package
measurement,” or dimensions expressed in inches as girth plus length. Under that
rate structure, packages with dimensions of girth plus length equal to or less than
84 inches would be charged according to the package’s actual weight. However,
packages whose girth plus length exceeded 84 inches were charged the greater of
actual weight or a flat rate, depending on the package’s dimensional classification.
Thus, for domestic packages:
• Packages measuring greater than 84 inches and not more than 108 inches
were categorized as Oversize (“OS”) I packages and charged the greater of
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actual weight or a flat 30 pound rate;
• Packages measuring greater than 108 inches but not more than 130 inches
were categorized as OS II packages and charged the greater of actual weight
or a flat 70 pound rate; and
• Packages measuring greater than 130 inches and not more than 165 inches
were categorized as OS III packages and charged the greater of actual
weight or a flat 90 pound rate.
40. In addition, UPS assesses “Large Package Surcharges” of up to $45
for domestic services when its length plus its girth combine to equal greater than
130 inches but less than the “maximum UPS size” of 165 inches. In addition,
“large packages” are subject to a minimum “billable weight” of 90 pounds.
41. Packages that exceed 108 inches in length, or exceed a total of 165
inches in length and girth combined, are not acceptable for shipping. If such
packages are found in the UPS system, they are subject to an additional charge of
42. Finally, an “Additional Handling” charge of $8 is applied, inter alia,
to packages where the largest size exceeds 60 inches, or its second-longest side
exceeds 30 inches.
43. Accordingly, in many instances small differences in size
measurements lead to increased charges for UPS package shipments.
C. UPS Instructs Shippers on How To Measure Packages
44. UPS instructs Shippers on how to measure and weigh packages in its
Rate and Service Guide.
45. In particular, Shippers are instructed to determine the width, length
and height of packages by measuring along the edge of packages. With respect to
“irregularly shaped packages,” Shippers are advised to “[t]reat the irregularly
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shaped package as if it were a regular rectangular box,” and to “[m]easure the
length, width and height of the package from its extreme points.”
46. UPS further instructs Shippers: “For each measurement, round any
fraction to the nearest whole number (for example 1.00 to 1.49 will be considered
1, and 1.50 to 1.99 will considered 2).” That instruction applies whether
measuring for cubic size or for length plus girth.
47. In addition, in calculating dimensional weight (the “cubic size”
divided by 194), Shippers are instructed to “increase any fraction to the next
48. These dimensions are the key to all the various dimension-based
charges discussed above; once the Shipper determines the size, length and width,
computer software determines, among other things, the “billable weight” and
whether any size-based surcharges or exclusions are mandated.
49. Plaintiffs have followed the UPS Retail Rate and Service Guide in
determining the dimensions of a package as have many thousands of Shippers.
50. Indeed, some Shippers and Class Members are in the business of
shipping packages, and they have no incentive to undercharge their customers as
undercharging their customer would cut directly into their profits.
51. Once those Class Members have determined the proper charges, they
collect the charges from their customers. If UPS “adjusts” the charges upwards,
Class Members have no way of recouping the resulting charges from their
52. In fact, to further efforts to ensure that Shippers enter the correct
measurements—and thereby avoid increased charges from UPS—many Shippers
pre-program their software to automatically generate the measurements of
packages they typically use for Shipping. UPS publishes on its web page a
document entitled “Avoid Shipping Charge Corrections” in which it encourages
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Shippers to pre-program their package sizes, and in some instances UPS assists
those Shippers to do so. Thus, for example, when Shippers repeatedly use likesized
packages, UPS encourages or will pre-program that Shipper’s software so
that the Shipper does not need to repeatedly enter (or measure) packages they send.
However, and despite those efforts, as a result of UPS’s Multiple Dimension
Measuring Devices, members of the Class that took advantage of this preprogramming
were still often assessed adjusted charges by UPS because those
devices improperly measured the packages.
D. UPS Re-Measures Packages Using A Different Methodology Than The
Methodology It Mandates For Class Members And Frequently Adjusts
The Measurements In Its Own Favor
53. When the shipped package arrives at a UPS hub, UPS remeasures
each package using its Multiple Dimension Measuring Devices. Based on its
measurement, UPS often “adjusts” the charges upward from those assessed by the
Shipper and these “adjustments” are reflected when UPS invoices the Shipper.
54. Even a small error can have severe consequences since, as discussed
above, UPS instructs Shippers to “round up” at .50 inches and to “round down” at
.49. Thus, a difference as small as one-hundreth of an inch can result in a
“rounding up” of a single dimension of a package (either the height, length or
width), with significant results to the Shipper. For example, for a package with
true dimensions of 43” in length, 23.49” in height, and 20” in width:
True Dimensions
43 x 23.49 x 20
True Dimensional weight
101.96 lbs
Charged at 102 lbs
True Length + Girth
129 inches
Charged at OS 2 rate
Erroneous Dimensions
(addition of .01 inch to
43 x 23.50 x 20
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Erroneous Dimensional
weight (domestic)
106.39 lbs
Charged at at 107 lbs
Erroneous Length + Girth
131 inches
Charged at OS 3 plus Large
Package Surcharge
55. UPS’s measuring devices may make an erroneous calculation for any
one of several reasons.
56. First, on information and belief, UPS’s measuring devices are, at best,
only accurate to within 1/5 of an inch, or 1/10 of an inch, and are not accurate to
within 1/100 of an inch. For this reason alone, UPS’s measuring devices are not fit
for the purpose for which UPS uses them.
57. Second, if the package has a “bulge” in the center, UPS’s measuring
devices will come up with longer dimensions than the Shipper, who measures
along the edge of the package in keeping with UPS’s instructions in the Rates and
Services Guide. Moreover, many “bulges” develop in between the time the
Shipper measures the package and the time UPS re-measures the package at its
58. Third, the Multiple Dimension Measuring Devices may be improperly
calibrated or otherwise improperly maintained. It is impossible for state and local
Weights and Measures department to ascertain whether the machines are properly
maintained since UPS takes the position that it is immune from state regulation in
this area.
59. Finally, the packages are placed by employees on fast-moving
conveyor belts; if the package is not properly placed, the resulting measurement
may be inaccurate.
60. To make matters worse, the inaccurate measurements are performed
by UPS at a time and place that make it virtually impossible for Plaintiffs and
putative Class Members to challenge the inaccurate measurements.
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61. Because of the flaws in the Multiple Dimension Measuring Devices,
and because they measure packages in a different manner than that which UPS
mandates for Shippers, it is improper and unfair to use the laser measurement as a
basis for adjusting the Shippers’ invoices in UPS’s favor.
62. UPS has systematically rebilled Plaintiffs and members of the Class
based on its inaccurate measuring system. This has cost Plaintiffs as much as
hundreds of dollars on a monthly basis.
63. On information and belief, UPS only uses the faulty laser
measurements to its own advantage. UPS does not, for example, provide a credit
to Shippers when the Multiple Dimension Measuring Devices measure a package’s
dimensions at less than the actual measurements.
E. Attempting to Dispute Adjustments is Futile
64. The Shipper only becomes aware of the “adjustment” when it receives
its invoice from UPS. By that time, unless the package was lost or returned, it is
extremely difficult, and often impossible, for the Shipper to contest the charges,
particularly when the Shipper no longer has access to the specific package shipped.
65. Since the introduction of the Multiple Dimension Measuring Devices,
Plaintiffs and Class Members have often complained about UPS’s “adjustments,”
with limited to no success.
66. Some Shippers were told in January of 2007 or thereafter that UPS
would withdraw its price adjustment as a one-time “courtesy;” after that, UPS’s
standard response has been that the lasers are infallible and no adjustments will be
67. Other Shippers were instructed that only two adjustments per 180 day
period are permitted. This is unconscionable given that many Shippers receive
many small adjustments in weekly invoices. These charges can amount to
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hundreds of dollars a month, and according to UPS’s policy they cannot be
contested once two adjustments have been made.
68. It is difficult and frustrating for Shippers to contest adjustments to
their bills. UPS’s vague and unclear policies are not clearly communicated to
Shippers. Shippers are required to endure lengthy and cirquitous phone calls being
transferred from one customer service agent to another.
69. In some instances, UPS responded to Shippers’ complaints by placing
them on a “no adjustments” list which prevented those Shippers from having any
further overcharges refunded or otherwise cleared, further rendering futile any
effort to contest the overcharge.
F. UPS Is Aware That Its Measuring System Is Inaccurate
70. The inaccuracies of the UPS system is known to UPS and has recently
been criticized by its own Franchisees:
Platinum Shield Association Says United Parcel Service
Charges Unfairly Because of Improper Measurements of
Monday April 30, 1:53 pm ET
NEW YORK, April 30 /PRNewswire/ -- Officials of the
Platinum Shield Association (PSA), whose members own
and operate United Parcel Service (NYSE: UPS - News)
franchises across the United States under the Mail Boxes
Etc. brand, charged today that UPS imposes higher
shipping costs on franchisees due to UPS’ manipulation
of the dimensional weight system used to determine
package size and weight for shipping.
‘This is significant, because the franchisees find it almost
impossible to dispute the increased costs with UPS once
the package is in UPS’ control,’ said Joe Wightman, a
UPS/MBE franchisee in New York. “More importantly,
we believe this situation may affect all UPS shipping
customers,” he added.
Wightman quoted a recent memo the UPS Store Area
Franchise Developer sent to UPS franchises, which
confirmed that UPS is changing the shipping weight of
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packages: “If you as a franchisee are being hit with
substantial UPS billing adjustments for restated
dimensions of your store's shipments, and you are
convinced that your original dimensions are accurate ...
Look carefully at your bill to see if UPS changes the
dimensions of these boxes and increases the billed
amount based upon their laser scanning based audit.”
Wightman pointed out that this places the franchisees in
an impossible position, because they are in dispute with
their shipping vendor, which also owns their franchise.
Wightman characterized the issue as an inexcusable
abuse of UPS franchisees, many of whom are already in
an unprofitable circumstance. “UPS scans the packages
with its own lasers after the box is out of our hands and
then restates the charges. How is this equitable? Our
experience suggest that the restating of shipping costs to
higher levels results from the impact of packages being
deformed after being piled on each other by UPS during
transit and not by any conscious measurement errors by
the franchisees. How can UPS justify such a practice?”
Wightman added that his organization, PSA, believes
Federal and state government agencies should intervene
to insure shipping consumers that the amount they are
being charged is fair and accurate.
71. UPS representatives have also acknowledged that the measurement
system may be inaccurate.
G. Illustrative Examples of UPS’s Faulty Measurement System
72. The following examples of Plaintiffs experiences illustrate the
damages caused by UPS’s faulty measurement system and the need for UPS to
reform the system.
73. Plaintiff Berg designs and sells, among other things, strollers. Berg
orders custom made boxes to ship its products to customers. One particular box,
the triple box, was designed to fit at the upper cusp of UPS’s OS 2 billing rate in
order to avoid the Large Package Surcharge imposed on those subject to the OS 3
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74. For many years UPS erroneously charged Berg OS 3 rates for
shipping the triple box, plus a Large Package Surcharge. At one point, UPS issued
Berg a rubber stamp he was to use in order to avoid these errors. That stamp read,
in part: “ATTEN: This pkg., when shipped, met UPS standard size requirements
not exceeding 130” in length & girth combined.”
75. Berg’s problems with UPS’s overcharges of the triple box increased in
2005 and 2006. Despite using the same boxes for years, UPS continued to
overcharge Berg’s shipments. Many of Berg’s invoices show that the incorrect
overcharges were a result of UPS’s incorrect measurement of one side of the
package by as little as one inch. Indeed, over the course of one particular nine
month period, UPS measured the same box, containing the same product, with at
least 8 different measurement combinations.
76. Berg frequently complained to his account representative about the
overcharges. In response, UPS occasionally reversed the overcharges and often
times ignored the complaints. UPS sent representatives to Berg’s business to
program his package sizes into UPS’s software but the improper overcharges
continued. Ultimately, in response to Berg’s complaints, UPS placed Berg on a
“No Adjustments” list meaning UPS would no longer adjust any alleged incorrect
charges made to Berg, despite his objections or complaints.
77. In reviewing actual bills received by Plaintiff Persepolis Enterprises, a
franchise owner of a “UPS Store,” there are many instances of packages that were
measured by the franchise owner in accordance with UPS directions and then later
being rebilled or adjusted by UPS as a larger package.
78. A few examples are as follows:
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79. The above table was constructed from a random sampling of dozens
of charge back amounts from just one of over 4,000 UPS stores. The amounts
charged for all other UPS account holders is unknown at this time, but certainly
have the probability of cumulatively running into the millions of dollars.
80. Plaintiffs bring this action pursuant to Fed. R. Civ. P. 23 on behalf of
a Class defined as:
All U.S. persons and entities who either (i) own and
operate United Parcel Service (“UPS”) franchises under
the Mail Boxes, Etc. and UPS store brands, or (ii) own
and operate “Third Party Retailers” of UPS shipping
services (which includes Authorized Shipping Outlets,
UPS Alliance Locations located in Staples and Office
Depot retail locations, and Commercial Counters) or (iii)
have accounts with UPS and have received an upward
adjustment from UPS based on UPS’s remeasurement of
a package.
81. Excluded from this Class are (a) Defendant and any entity in which
Defendant has a controlling interest, and its legal representatives, officers,
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directors, assignees and successors, (b) any co-conspirators, and (c) any
governmental entities. Also excluded from the Class is any judge or justice to
whom this action is assigned, together with any relative of such judge or justice
within the third degree of relationship, and the spouse of any such person.
82. The Class consists of hundreds of thousands of individuals or entities
throughout the United States, making individual joinder impractical, in satisfaction
of Fed. R. Civ. P. 23(a)(1). The disposition of the claims of the Class Members in
a single class action will provide substantial benefits to all parties and to the Court.
83. The claims of the representative Plaintiffs are typical of the claims of
the Class, as required by Fed. R. Civ. P. 23(a)(3), in that the representative
Plaintiffs are entities who, like all Class Members, regularly ship packages and
were subject to a UPS billing adjustment. Such representative Plaintiffs, like all
Class Members, have been damaged by Defendants’ misconduct.
84. The factual and legal bases of Defendants’ misconduct are common to
all members of the Class and represent a common thread of misconduct resulting in
injury to Plaintiffs and all members of the Class.
85. There are many questions of law and fact common to the Class and
those questions predominate over any questions that may affect individual Class
Members, within the meaning of Fed. R. Civ. P. 23(a)(2) and 23(b)(3). Common
questions of law and fact include, but are not limited to, the following:
(a) Whether UPS uses Multiple Dimension Measuring
Devices as part of a system of “remeasuring” packages it receives
from Shippers;
(b) Whether the “remeasuring” system is inaccurate, and
appropriate for the purpose for which it is used by UPS;
(c) Whether UPS has systematically adjusted bills or
accounts based on this system;
(d) Whether “adjustment” to bills based on that system are
Case 5:06-cv-04686-IPJ Document 42-2 Filed 09/24/2007 Page 19 of 29
(e) The amount of damages owing to the Class; and
(f) whether and to what extent injunctive or other equitable
relief is available.
86. Certification is also appropriate under Fed. R. Civ. P. 23(b)(2)
because UPS’ Measurement Overcharge Scheme has impacted the Class in a
similar fashion such that final injunctive relief or corresponding declaratory
relief with respect to the Class as a whole is appropriate.
VIOLATIONS OF 18 U.S.C. § 1962(C)
87. Plaintiffs, on behalf of themselves and all others similarly situated,
reallege and incorporate herein by reference each of the allegations contained in
the preceding paragraphs of this Amended Complaint.
88. Plaintiffs, the members of the Class, and the Defendants are
“persons,” as that term is defined in 18 U.S.C. § 1961(3).
89. The following manufacturers of the Multiple Dimension Measurement
Devices used by Defendants are each “persons,” as that term is defined in 18
U.S.C. § 1961(3): (a) Mettler, Toledo, Inc., headquartered are in Columbus, Ohio;
(b) Sick AG, whose North American headquarters are in Minneapolis, Minnesota;
and (c) Quantronix, Inc., headquartered in Farmington, Utah. These entities, as
well as all other manufacturers of Multiple Dimension Measuring Devices used by
UPS, are sometimes collectively referred to herein as “the Manufacturers.”
90. At all relevant times, in violation of 18 U.S.C. § 1962(c), the
Defendants conducted the affairs of certain association-in-fact enterprises
identified herein, the affairs of which affected interstate commerce through a
pattern of racketeering activity.
Case 5:06-cv-04686-IPJ Document 42-2 Filed 09/24/2007 Page 20 of 29
The UPS-Manufacturer Enterprises
91. The RICO “enterprises” are associations-in-fact consisting of (a) one
of the Manufacturers of the Multiple Dimension Measuring Devices used by UPS,
and (b) UPS, including its directors, employees and agents. These associations-infact
are sometimes collectively referred to herein as the “UPS-Manufacturer-
Enterprises.” Each of the UPS-Manufacturer Enterprises is an ongoing and
continuing business organization consisting of both corporations and individuals
that are and have been associated for the common or shared purposes of (a)
disseminating and using Multiple Dimension Measuring Devices for the
measurement of the Class Members’ packages and (b) deriving profits from these
activities. Each of the enterprises had a common purpose of perpetuating the use
of Multiple Dimension Measuring Devices for the measurement of Class
Members’ packages so as to maximize the profits of the participants in the
enterprises. UPS has this as a purpose because it profits from the use of devices,
which (i) result in false overcharges to Plaintiffs and the Class; and (ii) allow UPS
to remeasure huge numbers of packages in a very short period of time with a
minimal number of employees. The Manufacturers have this as a purpose because
they desire to sell as many of their devices to UPS as they can, regardless of
whether or not the machines are sufficiently accurate for the purpose for which
they are used by UPS. In short, each of the participants in the UPS-Manufacturer
Enterprises has the common purpose of making money.
92. The Manufactures were willing participants in the Enterprises, shared
a common purpose with UPS, and agreed to a structure wherein UPS made
decisions as to which Multiple Dimension Measuring Devices would be purchased,
the manner in which they would be used, and the software with which they would
interface to generate invoices making “adjustments” to the charges assessed by
Case 5:06-cv-04686-IPJ Document 42-2 Filed 09/24/2007 Page 21 of 29
Shippers. This structure was the basis in which each of the enterprises was
structured and its affairs conducted.
93. The UPS-Manufacturer Enterprises are identified as follows:
(a) The UPS – Mettler, Toledo Enterprise
(b) The UPS—Sick, AG Enterprise
(c) The UPS—Quantronix, Inc. Enterprise
94. The UPS-Manufacturer Enterprises also include all other
manufacturers of Multiple Dimension Measuring Devices used by UPS.
UPS’s Use of the U.S. Mails and Interstate Wire Facilities
95. UPS engaged in and affected interstate commerce because it engaged
in the following activities across state boundaries: The transmission of false and
misleading invoices and invoice “adjustments” based on inaccurate measurements
made by Multiple Dimension Measuring Devices; and the collection of monies
based on the same.
96. During the Class Period, the UPS Defendants’ illegal conduct and
wrongful practices were carried out by an array of employees, working across state
boundaries, who necessarily relied upon frequent transfers of documents and
information, products, and funds by the U.S. mails and interstate wire facilities.
97. The nature and pervasiveness of the Measurement Overcharge
Scheme, which was orchestrated out of UPS’s corporate headquarters, necessarily
required headquarters to communicate directly and frequently by the U.S. mails
and by interstate wire facilities with the various regional facilities and “hubs”
where the measurement of Class Members’ packages occurs. In addition, UPS
representatives used U.S. mails and interstate wire facilities to communicate with
Plaintiffs and members of the Class about the improper overcharges.
98. The precise locations of Defendants’ “hubs,” and dates of Defendants’
uses of the U.S. mails and interstate wire facilities (and corresponding RICO
Case 5:06-cv-04686-IPJ Document 42-2 Filed 09/24/2007 Page 22 of 29
predicate acts of mail and wire fraud) are known to UPS, and are so voluminous
that they cannot be alleged without access to these Defendants’ books and records.
However, Plaintiffs can generally describe the occasions on which the RICO
predicate acts of mail fraud and wire fraud occurred, and how those acts were in
furtherance of the UPS’s Scheme, and do so below.
99. The Defendants’ use of the U.S. mails and interstate wire facilities to
perpetrate the Measurement Overcharge Scheme involved millions of
communications throughout the Class Period including, inter alia:, (a) UPS’s
sending of invoices containing false invoices and “adjustments” based on the
dimensional measurements recorded at its hubs by the Multiple Dimension
Measuring Devices; (b) Written and oral communications with Plaintiffs and Class
Members who complained about the overcharges; (c) Written and oral
communications from headquarters to regional facilities and hubs directing the
responses to customers who complain about the overcharges; (d) Written and oral
communications directed to state regulatory agencies, UPS’s franchisee
association, and news media that fraudulently misrepresented the Multiple
Dimension Measuring Devices were accurate and proper for the use to which they
are put by UPS; and (e) Receipts of money sent on tens of thousands of occasions
through the U.S. mails and interstate wire facilities – the wrongful proceeds of the
Measurement Overcharge Scheme.
Conduct of the RICO Enterprises’ Affairs
100. During the Class Period, UPS exerted control over the UPSManufacturer
Enterprises and, in violation of Section 1962(c) of RICO, UPS has
conducted or participated in the conduct of the affairs of those RICO enterprises,
directly or indirectly, in the following ways:
Case 5:06-cv-04686-IPJ Document 42-2 Filed 09/24/2007 Page 23 of 29
(a) UPS has determined which Multiple Dimension Measuring
Devices it will purchase, and which software it will use to interface with
those devices;
(b) UPS has directly controlled the manner in which the
measurement devices are used, including, inter alia, how the machines will
be installed, maintained and calibrated, how the personnel using the devices
will be trained, and how charges will be assessed to Shippers;
(c) UPS and its employees have full control over the operation of
the measurement devices;
(d) UPS has controlled and participated in the affairs of the UPSManufacturer
Enterprises by using a fraudulent scheme to measure packages
and bill Shippers, including implementation of a rate structure that facilitated
the goals of the Measurement Overcharge Scheme; and
(e) Each of the Manufacturers has allowed UPS to exert control
over the Enterprises knowing that UPS was using their measurement devices
in an inappropriate and fraudulent manner. Each Manufacturer did so
because the sale of its equipment to UPS was, and is, a major part of its
101. Each of the UPS-Manufacturer Enterprises had a hierarchical
decision-making structure headed by UPS.
102. In violation of Section 1962(c) of RICO, UPS has conducted the
affairs of each of the UPS-Manufacturer Enterprises by assessing charges to
Shippers based upon the false measurements generated by the Multiple Dimension
Measuring Devices.
103. Defendants engaged in the Measurement Overcharge Scheme with the
intent to defraud Plaintiffs and members of the Class. Defendants knowingly
measured packages incorrectly and enforced their rate structure in a manner that
Case 5:06-cv-04686-IPJ Document 42-2 Filed 09/24/2007 Page 24 of 29
would enduce Plaintiffs and members of the Class to pay higher rates than their
packages otherwise should have been subject to.
UPS’s Pattern of Racketeering Activity
104. UPS has conducted and participated in the affairs of the abovereferenced
UPS-Manufacturer Enterprises through a pattern of racketeering
activity, including acts that are indictable under 18 U.S.C. § 1341, relating to mail
fraud, and 18 U.S.C. § 1343, relating to wire fraud. UPS’s pattern of racketeering
likely involved millions of separate instances of use of the U.S. mails or interstate
wire facilities in furtherance of the Measurement Overcharge Scheme. Each of
these fraudulent mailings and interstate wire transmissions constitutes a
“racketeering activity” within the meaning of 18 U.S.C. § 1961(1)(B).
Collectively, these violations constitute a “pattern of racketeering activity,” within
the meaning of 18 U.S.C. § 1961(5), in which UPS intended to defraud Plaintiffs
and members of the Class.
105. The Shipping Overcharge Scheme ensured that Plaintiffs and
members of the Class would be over-billed for the packages they shipped with
106. Each of the Plaintiffs were assessed, and paid, overcharges based
upon false dimensional measurements based on UPS’s use of Multiple Dimension
Measuring Devices.
107. By intentionally using measurement devices that it knows are
inaccurate and improper for the purposes for which it uses the devices, then billing
Shippers based on the inaccurate measurements, UPS engaged in a fraudulent and
unlawful course of conduct constituting a pattern of racketeering activity.
108. UPS’s racketeering activities amounted to a common course of
conduct, with similar pattern and purpose, intended to deceive Plaintiffs and
members of the Classes. Each separate use of the U.S. mails and/or interstate wire
Case 5:06-cv-04686-IPJ Document 42-2 Filed 09/24/2007 Page 25 of 29
facilities employed by UPS was related, had similar intended purposes, involved
similar participants and methods of execution, and had the same results affecting
the same victims, including Plaintiffs and members of the Classes.
Damages Caused by UPS’s Shipping Overcharge Scheme
109. UPS’s violations of federal law and its pattern of racketeering activity
has directly and proximately caused Plaintiffs and members of the Class to be
injured in their business or property because Plaintiffs and members of the Classes
have paid many millions of dollars in improper overcharges based upon UPS’s use
of Multiple Dimension Measuring Devices.
110. UPS sent billing statements through the U.S. mails or by interstate
wire facilities in furtherance of their Shipping Overcharge Scheme. Plaintiffs and
members of the Class have made inflated payments for Shipping based on and/or
in reliance on false measurements.
111. On information and belief, UPS continues to measure packages using
imperfect Multiple Dimension Measuring Devices and to apply a rate structure
designed to allow UPS to take advantage of those imperfections in order to collect
improper overcharges from its customers. UPS continues to improperly
overcharge members of the Class for shipping charges. These ongoing violations
of RICO continue to harm members of the Class in that, among other things,
franchise owners and Third Party Retailers are unable to recoup these additional
costs from clients and UPS acts to make efforts to complain or contest the
overcharges futile. Individual account holders are equally harmed in that UPS acts
to make their efforts to complain or contest the overcharges futile and, frequently,
those Class Members no longer have access to the packages once shipped.
Accordingly, Plaintiffs and members of the Class seek appropriate injunctive
relief, without which UPS will continue to engage in the above-described illegal
Case 5:06-cv-04686-IPJ Document 42-2 Filed 09/24/2007 Page 26 of 29
112. Under the provisions of Section 1964(c) of RICO, UPS is liable to
Plaintiffs and members of the Class for three times the damages that Plaintiffs and
the Class Members have sustained, plus the costs of bringing this suit, including
reasonable attorneys’ fees.
113. Plaintiffs incorporate by reference the preceding allegations as if fully
set forth herein.
114. UPS’ Multiple Dimension Measuring Devices incorrectly measured
and continue to incorrectly measure packages shipped by Plaintiffs and members
of the Class, resulting in measurements greater than the packages’ true
measurements. UPS charges and continues to charge Plaintiffs and members of the
Class higher rates based on those incorrect measurements including, frequently,
“large package” charges.
115. Throughout the Class period, Plaintiffs and members of the Class
were contractually obligated to pay shipping rates as set out in the rate and service
guide and under UPS’s published rate structures. At the same time, UPS was
contractually obligated to charge no more than those same rates, to deal with
Plaintiffs and the Class Members in good faith and fairly, and to properly and
accurately measure packages using an adequate, properly calibrated, and tested
method with sufficiently low tolerances.
116. UPS had a contractual obligation to honor and accept as correct the
weight or size of packages that were correctly measured based on the UPS Rate
and Service Guide.
117. In measuring any package, UPS’s measurements would have to be
determined using the same instructions that the Class Members are required to use.
Case 5:06-cv-04686-IPJ Document 42-2 Filed 09/24/2007 Page 27 of 29
118. Moreover, UPS has an obligation to deal fairly and in good faith with
its Shippers. This obligation includes, at a minimum, (1) ensuring that Shippers
rights are considered and protected; and (2) using only accurate, properly
maintained measurement devices that are (3) suitable for the purpose for which
UPS uses the devices.
119. UPS has breached its obligation to Shippers.
120. As a result, Shippers have been damaged.
WHEREFORE, Plaintiffs respectfully prays as follows:
A. Certification of the Class pursuant to Fed. R. Civ. P. 23(b)(2) and/or
B. For judgment against Defendant on its claims together with an award
of all damages available under such laws;
C. Treble damages pursuant to 18 U.S.C. § 1964(c);
D. Preliminary and permanent injunctions enjoining UPS from any
further racketeering activity;
E. Appropriate attorney’s fees, pursuant to 18 U.S.C. § 1964; and
F. For such other and further relief as the Court deems just and proper to
remedy Defendant’s unjust enrichment.
Pursuant to Federal Rule of Civil Procedure 38(b), Plaintiffs demands a trial
by jury on all issues so triable.
DATED: _____________________, 2007.
Case 5:06-cv-04686-IPJ Document 42-2 Filed 09/24/2007 Page 28 of 29
/s/ David R. Donaldson
David R. Donaldson
505 North 20th Street, Suite 1000
Birmingham, Al 35203
Telephone: (205) 226-2282
Facsimile: (205-226-2357
Of Attorneys for Plaintiffs in Intervention
Steve W. Berman
Andrew M. Volk
Genessa A. Stout
1301 Fifth Avenue, Suite 2900
Seattle, WA 98101
Telephone: (206) 623-7292
Facsimile: (206) 623-0594
Steve D. Larson
Christina Beatty-Walters
Joshua L. Ross
209 S.W. Oak Street, Fifth Floor
Portland, Oregon 97204
Telephone: (503) 227-1600
Facsimile: (503) 227-6840
Craig A. Nichols
David R. Kracke
4614 S.W. Kelly Avenue, Suite 200
Portland, Oregon 97239
Telephone: (503) 224-3018
Facsimile: (503) 222-0693
Case 5:06-cv-04686-IPJ Document 42-2 Filed 09/24/2007 Page 29 of 29

on September 26th, 2007

UPS Stores?

Who Knows if these UPS Stores are still open and operational?

Since opening her store in July 2003, Singer has continued to use SCORE’s counseling. “I meet with my current SCORE counselor, John Edwards, on a monthly basis to discuss operational issues,” Singer states. “John has helped me become a better manager. He’s impressed on me how important it is to train, develop and motivate my employees. He’s worked with me on setting objectives and advised me on how to deal with sensitive personnel issues. Because of his help, I believe I have one of the best teams of associates in The UPS Store system,” she adds.

Singer is very proud that her store achieved cash break-even the first full month in business. The business became profitable within the first six months of operation. “When the Store became profitable, I stopped asking my husband for an allowance,” she quips. Singer’s Store has won the Bronze Award from MBE/UPS for the past three years for reaching gross revenues over $375,000 per year. Singer hopes to earn a Silver Award in 2007 for gross revenues over $425,000. “Best of all,” she proudly proclaims, “in December 2006, I paid off the remainder of the $250,000 loan I had taken out to open the Store.”

TOM SCHERWITZ - UPS STORE #4997 - San Antonion, TX
Tom Scherwitz of San Antonio, Texas, never planned on running his own business. But after enduring two corporate downsizings, it seemed the best alternative to finding another job in a distant city that would require a long commute or uprooting his family.

But with so many possibilities and pitfalls associated with being a small business owner, Tom was venturing into unfamiliar territory.

Fortunately, he didn’t have to look far for help. His father-in-law, Hap Appleman, a former business owner, was also a SCORE volunteer counselor. After discussing Tom’s experience, skills and interests, they decided to investigate the world of franchising. Hap recommended that Tom contact The Entrepreneur’s Source, a consulting firm that performs advance screening services for many regional and national franchisers.

David Diaz, owner of "The UPS Store" in Congers did not have that luxury. He had been a Broadcast Technician at a major TV network in New York City for 27 years and had to work in a dark room without windows editing TV News film and video tape, and most of the time under heavy pressure and tight deadlines. As he describes it, "I had no life! I worked most weekends, had little time for vacation and never saw my children".

on July 23rd, 2007

Costco, The UPS Store Franchise

The UPS Store Franchise opportunity = SCAM!!!! Stay very clear away from this "opportunity".

on September 12th, 2007

looking at buying a ups store.

I am currently spending over 100k per month with ups and
for ground shipping my incentives are only 14% i am looking
at buy a store to get my other company a 50% discount.
any thoughts and does anybody see a problem?


on April 11th, 2007

A very costly mistake is buying a UPS Store Franchise!

This is not a viable business to be in! Many UPS Store franchise owners are filing bankruptcy, drying out their retirement accounts, maxing out their home equity line of credit - it’s a travesty!

on July 25th, 2007

buying a ups store

we are doing approx 600 boxes per day.
could i find a ups store and let them just scan my
boxes and split the 1.50 on each package on top
of my incentives do you think ups will pick up on this
and will it work.

on April 13th, 2007

Re: The UPS Store, Tales of Gore

I have just walked away from my UPS store and my $225,000 investment. I implore anyone considering an investment in this franchise to look elsewhere. The financial, emotional and personal losses are horrendous. Please do not make the same mistake I did.

on October 14th, 2007

I would like to join the class action suit

I live in California. I was shipping my packages happily, with the exception that a previous UPS Driver assaulted me in my home and stole money from me. Recently, I'm getting additional charges for packages that are not measured correctly. I weigh and measure all my packages and all of a sudden, I'm getting additional charges.

*****SO...I now mark ever package at 1 pound and the size at 4x4x4. I'm curious to see how this will play out. I'm tired of calling for credits. They've been adding 1 inch to each side of my boxes and sometimes, it throws me into an oversize package category.

on December 3rd, 2007

The UPS Store Franchise

3 Words sum up this franchise!!! RUN LIKE HELL

on October 15th, 2007

ups store legal update

update on UPS stores legal battle with parent company UPS.

on February 26th, 2008

UPS Loses Round in Legal Battle With Franchsiees

LOS ANGELES, Oct. 19 /PRNewswire/ -- A California court has certified a national class action brought by United Parcel Service franchisees against UPS (NYSE: UPS). The class action involves claims of intentional misrepresentation and multiple statutory violations relating to UPS' conversion of more than 3400 Mail Boxes Etc. franchises to the UPS store. The suit contends that UPS misled franchisees into believing that the UPS Store model would be more profitable for the franchisees. Instead the suit alleges that the conversion was for the purpose of moving profits to UPS. The class action seeks rescission of the conversion and monetary damages
"This is a huge win for our organization," said Howard Spanier, a
Malibu, Calif. franchisee for over eighteen years who was forced by UPS to give up his Mail Boxes Etc. identity in 2006; "We look forward to UPS having to finally answer for its actions." Spanier is the president of the Platinum Shield Association, representing current and former MBE franchisees who filed suit against UPS over the alleged misrepresentations referenced in Wednesday's appellate
court decision. The appellate court noted the background of the dispute in its lengthy opinion, stating, "After evaluating a plan to create a network of 1,700 to 2,000 UPS-operated stores, UPS rejected that plan as requiring an initial investment and management costs that were too high. Instead, on April 30, 2001, UPS acquired MBE (based in San Diego) and transferred MBE's assets and liabilities to MBE Inc., a wholly owned subsidiary of UPS. UPS intended to acquire the MBE franchise system by converting MBE franchises into 'The UPS Store.'" Spanier and his fellow MBE franchisees allege that to persuade them to convert to the UPS Store, the Atlanta-based shipping giant withheld critical documents regarding tests UPS conducted in Seattle and St. Louis and other smaller cities for a new business model that was ultimately called The UPS Store. "We were never provided the information we needed to make an informed decision about our stores," Spanier said, "and when the conversion took place for those who agreed to it, the full impact of UPS' scheme was nonvoidable and disastrous for many." If successful, each franchisee class member will have the opportunity to rescind its UPS Store contract and to seek related damages. The impact of such a result would be ignificant to UPS both in terms of lost revenue and destruction of its retail network.

In its decision, the appellate court said, "We find that the trial
court made erroneous assumptions of law finding that individual issues predominated over common issues of law and fact with regard to reliance. Plaintiff (DT Woodard, a California franchisee of the former Mail Boxes Etc which UPS acquired in 2001) has alleged facts which create at least an inference of plaintiff's reliance on defendants' (UPS) representations, which induced plaintiff to agree to amend a franchise agreement.

on October 19th, 2007


My wife and I purchased an MBE store in 2000. It was a new style store, one of the first in Canada. We did our due dilligance by checking with stores in our area. What we did not realize (and weren’t told) was that they built their stores for max $75,000 at least 5 years prior. This was the amount they were expensing off in their financial statements. We knew we were paying somewhat more than the original stores, what with inflation and the cost of the series 2000 store. It cost us over $250000 to get up and running with the buildout and equipment. We tried for over 4 years to make it. I never drew a penny out of the complany in over 4 years. I was fortunate my wife had an income that allowed us to live. I was relieved when she finally said she would not invest any more money. We closed the doors, and our esteemed Area Franchisee paid all of $11000 for our $250000 investment. Enron fraud — MBE and UPS are worse. MBE stands for mostly bad experience. Don’t touch it unless you’re looking for a huge tax write off.

We had a Small Business loan from the Royal Bank secured by equipment and a personal guarantee and had a 25% Government Guarantee. When we closed the store, the Royal Bank seized the store for the security. To reopen the store, the Area Franchisee made an offer to the Bank for $11,000 and received the store in return. We had to pay the bank the balance owing, (except the part secured with the Gov Guarantee) based on our personal guarantee. Needless to say, our losses are much larger than the small business loan, because we had mortgaged our house to the limit (it was nearly paid for before our crazy decision to go into business with MBE). We will be paying on the mortgage for the next 15 years. And we are both close to 65.

Further to my comments above, a surprising benefit we did receive was from Revenue Canada. When we closed the company books with our Chartered Accountant, he made a very conservative filing of our loss so we would be eligable for a tax write off. He told us we would be getting an audit from Revenue Canada. He said Revenue Canada are not your friends, and to only tell them what they asked with their questions. We filed our income tax, and sure enough, we received a letter from them that we were being audited. I sent them all of the information they asked for. Within a few days, Revenue Canada phoned me. The gal doing the audit asked me what was going on with MBE/UPS. She said she had several files on her desk that were very similar to ours. I told her the whole story. I twigged that this may be a way of getting some come-uppance. I knew we would never know the results of the audit. She almost sounded excited. She asked who the Area Franchisee was, and the names of the big wigs in Oakville. She asked me to send proof of our total losses (on top of what our accountant claimed). To make a long story short, regardless what we think of Rev Can, we received a great tax write off. Also, I would love to have been a fly on the wall in Oakville when Corporate Office was audited.

on February 10th, 2008

Buying an existing UPS store....

What advice would you give someone who was interested in buying an existing UPS store?

on August 9th, 2007

TUPSS Drops in Rankings has dropped The UPS Store in its top rankings for 2008. It's down from #4 to now #11. Entrepreneur still considers it the best franchise opportunity in its category - postal services.

on March 9th, 2008

UPS Steals Christmas From Another Franchisee

UPS Still at War With Its Franchisees

STRONGSVILLE, Ohio, Dec. 11 /PRNewswire/ -- For the last dozen years, Chris May was a key part of her town's holiday shipping frenzy. Her United Parcel Service (UPS) (NYSE: UPS) Mail Boxes Etc. store in Strongsville was the local "go to" stop for regular mail services and those angst-ridden last-minute dashes to get Aunt Maude's package in the mail before the holiday deadline.

But this year, thanks to the indifference of senior management at UPS in faraway Atlanta, May and her family are spending the holidays out of the shipping business and contemplating the future without the store she had operated since 1995. "My son says I played chicken with a big brown truck and lost," May said.

The circumstance that led to May's loss of her franchise business in Strongsville has been repeated across the country since the 2001 acquisition of Mail Boxes Etc. (MBE) by UPS, and has led to May and some 130 of her fellow franchisees filing a lawsuit in California to redress the alleged misdeeds of UPS. A recent California appellate court action, overturning a lower court's decision, gives hope to the Platinum Shield Association members (including May) that they will now get their day in court.

As May recounts the events of the past five-plus years, she notes the enthusiasm she and many other former MBE owners found in the predictions of UPS senior officials, who promised that UPS would establish a combined marketing effort that would benefit every store owner. "We had gone through some rough financial times with the previous owner (U.S. Office Products), and we believed that UPS being a stronger company would put things back on the right track," May recalled.

"Then at the end of 2002," she continued, "we were told about a series of tests to determine what the new store format would be, and early in 2003 UPS held a series of road shows with franchisees when they rolled out the new concept called The UPS Store. More disturbing, though, was that we were told we had to make the decision almost immediately to convert from Mail Boxes Etc. to a new name and a dramatically less profitable business model.

"If we did not convert at that time," May remembered, "we were told we could remain Mail Boxes stores until our original agreements expired. This was really a shock, and we were never given any details on the tests to understand why UPS took the action they laid on us."

May said her original MBE agreement ran through the end of 2005, at which time the UPS system representatives informed her that she had to decide: throw away more than a decade of "brand-building" as an MBE store and convert to the UPS Store format, or go independent. "I'm a positive person," she said, "but I had already seen a drop of eight percent in my business in the first year after UPS took over, and then another 10 percent drop the next year, and the more I talked with other franchisees, the less I was sure that UPS had a good plan for us.

"I really thought at first that UPS just needed to tweak their plan a little to make it better, but all we saw was a reduction in our daily sales, less support from headquarters and no sign that we who had been MBE franchisees mattered in the long-term UPS plan," May added.

Then in February 2006 the full impact of UPS' effort to unify its retail outlets hit May, when UPS filed a temporary restraining order against her and many other franchisees in federal court, alleging that she and the others were violating trademark statutes by continuing to operate under the MBE banner. "They de-identified my store on February 1 and filed the TRO on February 14, Valentine's Day," she said. The federal court took more than six months to reach a decision to shift the case to California, where MBE was headquartered.

"The real sign of UPS' intent came in October of 2006 when they opened a UPS Store a half-mile from my store," May said, "and at that point I knew the end was near, because my franchise company was directly competing against me." On April 21, 2007 May closed her store and walked away from a 12-year run, from early success to the bitterness of what she feels was an unnecessarily harsh forced closure.

"It's sad to look back," May stated; "in the MBE days I was always in the top five stores in my district, and I thought the store would be a good revenue generator for years, and then we could sell it and put that money into our retirement plan." May added that she had not come to the franchise business with no background; she worked in marketing at Land 'o Lakes for several years, and her husband is a corporate veteran also.

"I had two kids while I ran the store, my son in 1997 and my daughter in 2004," she recalled, "and they both loved to come down to the store -- especially at holiday season -- and see all the action and talk to my customers. And I remember that one of my reasons for getting into the shipping franchise was because the town we used to live in didn't have one. So I'd drive to Strongsville and use the very store that I wound up buying."

When she thinks about the future, May says she hasn't completely ruled out perhaps trying another franchise. "Some are good, and as I've learned, some are not so good; I really enjoyed dealing with customers, and in a town like this, there is a family aspect that's great."

This year will be very different for Chris May and her family. Driving past her former store, she will remember the many crazy days of a dozen holiday seasons and the hard work she put into making her store a success. And then she will remember Valentine's Day of 2006, when all the planning and hard work were undone in an instant.

For further information please contact Joe Wightman, Platinum Shield Association at 917-880-9609 or Mike Furtney or Joann Killeen of the Killeen Furtney Group, Los Angeles. 310-476-6941 Office.

SOURCE Platinum Shield Association.

on December 11th, 2007

What happened to the UFOC for The UPS Store

It was posted here and now it has disappeared. Did Blue MauMau cave to pressure from UPS.

MBE claimed to be exempt from filing in California so the Cali-Ezy site is no help.

The UFOC still must be filed with the Federal Trade Commission.

Anyone know why it was posted here and now is gone?

on July 4th, 2007

ups store

I am lookin at an existing store that grosses 434k the owner says he gets 90k
he is asking 325k. is this worth looking into?

on June 13th, 2007

Pak Mail

Right-off-the-bat Pak Mail doesn't have the same problems which UPS Stores are currently faced with. Pak Mail does offer a very nice mix of Consumer & Business Services.

With that said, there is one very profitable seqment of the Pick/Pack/Mail/Ship business which these concepts have yet to pick up on. A market segment which in my opinion would provide the ZEE with a very strong competitive advantage in their market, along with high profitability. I'm not going to just toss the idea out here for everyone --- but anyone seriously considering entering into one of these concepts should prepare a solid business plan and really think about some of the related profit centers in the commercial segment. I would consider sharing the concept with anyone who is serious about the segment, and contacted me by Bluemaumau E-Mail.

Believe & Succeed,DaleFranSynergy, Inc.Synergizing Franchising!

Posted by FranSynergy on June 14th, 2007

buying an existing store

You really need to check all aspects of the finance of the store as questions like:
How much traffic do you have?
How many drop off"s does the store get?
How many package does UPS pickup daily?
What are your local supply vendors?
What is the current margin for packing and service fee?

Just a few questions, but you really need to check on thentotal business of the store.

on August 12th, 2007

UPS Lawsuit

What great news! Corporate Greed is alive and well and it is good to know that some of the UPS Store owners have survived to file a lawsuit in the federal courts and that the Federal Court accepted the ammended complaint.

Those store owners who are standing on the side, looking in, are hoping, I'm sure, that UPS will now understand that their stores are unprofitable and are hoping that they can survive until UPS takes positive steps to make The UPS Store a profitable enterprise.

It is not fair and not right that UPS should reap great profits from the labor and capital of the small investor who put his/her personal assets and life at risk, and who work long hours, to try to make a living in the UPS Store, and who, in the great majmority of cases, is barely breaking even or working for nothing, or is operating in the red.

It is understandable that many of the franchisees who didn't join the lawsuit felt that they couldn't afford to join and support this lawsuit and still keep their doors open. But, I'm sure that they are confident that UPS will get the message that THE UPS STORES ARE UNPROFITABLE because of an untested and flawed business plan that UPS advertised and sold to the public after they acquired MBE at a bargain price.

on March 22nd, 2007

Good to See Hankes' name

on the lawsuit.  He's an extremely passionate ally for franchisees and certainly a force to be reckoned with in franchise litigation.

We're cheering you on UPS Franchisees!

Posted by Tinker on March 22nd, 2007

UPS Entrepreneur Rating

The criteria for this Entrepreneur best rating in postal services is based on the success of MBE-UPS as to THEIR profits. There is no doubt that a good percentage of the Network of stores is in trouble but remains standing because MBE-UPS can sell discounted units out the back door and sell NEW franchises with the SHILL of the famous brand name. When franchisors can survive because they collect royalties, commissions, and fees etc.. on the gross sales of the units in the Network, a franchisor can survive nicely while the Network franchisees are struggling and taking the entire risk of building the physical network that wears the brand name.

Those stores standing at break even have to remain standing in order to avoid the loss of their entire investments, or try to sell their break-even investment and take a loss. Those who fail generally fail into obscurity when they don't have funds to join lawsuits.

Unfortunately, it appears to be public policy for the business media to be concerned only with the success and visibility of the franchisors, and franchisees are considered to be merely a resource to contribute to the visibility and viability of franchisors.

on March 17th, 2008

I'd Be Satisfied.....

If I could sell my UPS Store :(

on September 19th, 2007