Archive for Wednesday, April 4, 2001

Cargo companies protest FedEx deal

April 4, 2001

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— Companies upset by a $6 billion deal between the U.S. Postal Service and FedEx Corp. said the Justice Department isn't moving fast enough to determine if the partnership violates antitrust laws.

Four cargo airlines and about a dozen aviation-service companies sent a petition Tuesday urging the Justice Department to open a formal inquiry. It alleges the seven-year contract gives FedEx "immunity to monopolize aspects of mail service."

"What we want them to do is to open up a case and prevent this contract from going forward," said James Allen, a spokesman for Ohio-based Emery Worldwide Airlines.

Emery filed suit alleging the no-bid contract was illegal, but U.S. Court of Federal Claims Judge Christine Miller last month upheld the agreement in which FedEx will haul the Postal Service's Express Mail and Priority Mail as well as some first-class mail.

The contract has not provoked much criticism on Capitol Hill, but the air cargo carriers and their allies hope the issue will gain attention during a hearing today into the Postal Service's financial problems.

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