Tenth Circuit Rejects Claims Against the US Postal Service, Addressing Expressio Unius Canon

In June, the Tenth Circuit issued its “Order and Judgment in Rapid Enterprises, LLC v. United States Postal Service. Under the Federal Rules of Appellate Procedure 32.1 and the 10th Circuit’s Rule 32.1, an order and judgment “is not binding precedent, except under the doctrines of law of the case, res judicata, and collateral estoppel. It may be cited, however, for its persuasive value.” That’s annoying. In the statutory part of the case, the Court addressed an issue it had “never squarely addressed.” Except that it had addressed the issue in two prior unpublished opinion, and it here followed those two non-precedential opinions. As Morpheus put it,

It’s bad enough that SCOTUS issues non-precedential decision on procedural matters on the shadow docket, and then accuses District Courts of defying SCOTUS in distinguishable cases, as though the non-precedential resolved the merits of the dispute and were factually indistinguishable from the new matter. That is not a precedent that Circuit Courts should follow.

But I digress.

Rapid Enterprises, LLC, dba as Express One (Express One) entered into a reseller program agreement with the US Postal Service (USPS). As the Court describes it, USPS sells is products to Express One which can then re-sell them at a mark-up and retain the profits. Pretty much sums up my views of why privatization of public services does not serve the public interest. We get the same services at a higher cost from a private party that is not constrained by law as are governmental entities. If the USPS cannot handle its work, raise rates and hire more employees. Done.

But I digress.

Anyhoo, the parties’ agreement began in 2019 and was terminable upon ninety days notice. In 2022, USPS provided that notice. Express One sued, alleging ten causes of action, sounding in federal statutes, torts, and breach of contract. The District Court dismissed the claims, some for lack of subject-matter jurisdiction and some on the merits.

One of Express One’s theories of breach was that USPS had misappropriated its confidential consumer information. It cites to the following contractual language:

Express One first argues that, having listed the purposes for which USPS could use its confidential information, all other uses were excluded under the principle of expressio unius. The Court doesn’t have much to say in response to this argument. It simply finds that the quoted language does not prohibit USPS from using Express One’s information as it did.

Express One argues that the quoted language is ambiguous, but the Court will not permit a party to prestidigitate ambiguity by presenting self-serving interpretations of otherwise clear provisions. This is more or less the opposite of a situation where contra proferentem might apply such that ambiguous provisions would be construed against the drafter. Express One is a sophisticated party that could have negotiated for the sorts of protections of confidential information that it now seeks. It failed to do so.

Express One’s final breach of contract claim relates to its claim that USPS violated the Postal Accountability and Enhancement Act (PAEA), which it claimed was incorporated into the parties’ agreement. The parties introductory recitals provided as follows:

The Court accepts that the reference to Title 39 is a reference to the PAEA. However, the Court noted that courts are “reluctant to find that statutory or regulatory provisions are incorporated into a contract with the government unless the contract explicitly provides for their incorporation.” The quoted language is not enough, says the Court, a ruling I find baffling. The Court says that the mere “mention” of the PAEA does not incorporate the. PAEA into the contract. What’s the purpose of the language? Why include it at all? The Court exhibits no curiosity on that point.