[Federal Register Volume 74, Number 18 (Thursday, January 29, 2009)]
[Proposed Rules]
[Pages 5137-5141]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E9-1864]


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POSTAL SERVICE

39 CFR Part 958


Rules of Practice in Proceedings Relative to Mailing Hazardous 
Materials

AGENCY: Postal Service.

ACTION: Proposed rule.

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SUMMARY: The Postal Accountability and Enhancement Act requires the 
Postal Service to prescribe regulations for the safe transportation of 
hazardous materials in the mail, and to prescribe regulations for the 
conduct of proceedings to determine the implementation of civil 
penalties, clean-up costs and damages for violations of these hazardous 
materials regulations. Accordingly, the Postal Service proposes to 
adopt new rules of practice for its Office of the Judicial Officer.

DATES: Comments must be received on or before March 2, 2009.

ADDRESSES: Judicial Officer Department, United States Postal Service, 
2101 Wilson Boulevard, Suite 600, Arlington, VA 22201-3078.

FOR FURTHER INFORMATION CONTACT: Administrative Judge Gary E. Shapiro, 
(703) 812-1910.

SUPPLEMENTARY INFORMATION: The Postal Accountability and Enhancement 
Act (Pub. L. 109-435, 120 Stat. 3198 (December 20, 2006)) inserted 
section 3018 into title 39, United States Code. Section 3018(a) 
requires the Postal Service ``to prescribe regulations for the safe 
transportation of hazardous material in the mail.'' Section 3018(c) 
requires the Postal Service to implement procedures for the imposition 
of civil penalties, clean-up costs and damages for violations of these 
hazardous materials regulations. Section 3018(d) provides that the 
Postal Service may determine that a person has violated these 
regulations only after notice and an opportunity for a hearing in 
accordance with section 3001(m) of title 39, United States Code.
    Accordingly, the Postal Service is proposing to adopt implementing 
regulations as new 39 CFR part 958, which would designate the Chief 
Postal Inspector as the Postal Service's Determining Official for 
purposes of these rules. Any hearing would be presided over by an 
Administrative Law Judge designated by the Postal Service Judicial 
Officer. Administrative appeals of a Presiding Officer's decision would 
be determined by the Judicial Officer.
    Although exempt from the notice and comment requirements of the 
Administrative Procedure Act (5 U.S.C. 553(b), (c)) regarding proposed 
rulemaking by 39 U.S.C. 410(a), the Postal Service invites public 
comment on the following rules proposed to be codified at title 39, 
Code of Federal Regulations, part 958.

List of Subjects in 39 CFR Part 958

    Administrative practice and procedure, Penalties, Postal Service.

    For the reasons stated in the preamble, the Postal Service proposes 
to amend 39 CFR part 958 as set forth below:
    1. Part 958 is added to read as follows:

PART 958--RULES OF PRACTICE IN PROCEEDINGS RELATIVE TO CIVIL 
PENALTIES, CLEAN-UP COSTS AND DAMAGES FOR VIOLATION OF HAZARDOUS 
MATERIAL REGULATIONS

Sec.
958.1 Purpose.
958.2 Definitions.
958.3 Petition for hearing.
958.4 Referral of complaint.
958.5 Scope of hearing; evidentiary standard.
958.6 Notice of docketing and hearing.
958.7 Hearing location.
958.8 Rights of parties.
958.9 Responsibilities and authority of presiding officer.
958.10 Prehearing conferences.
958.11 Respondent access to information.
958.12 Depositions; interrogatories; admission of facts; production 
and inspection of documents.
958.13 Sanctions.
958.14 Ex parte communications.
958.15 Post-hearing briefs.
958.16 Transcript of proceedings.
958.17 Initial decision.
958.18 Appeal of initial decision to Judicial Officer.
958.19 Form and filing of documents.
958.20 Service of notice of docketing and hearing, other documents.
958.21 Computation of time.
958.22 Continuances and extensions.
958.23 Settlement.

    Authority: 39 U.S.C. 204; 39 U.S.C. 401; 39 U.S.C. 3001; 39 
U.S.C. 3018.


Sec.  958.1  Purpose.

    This part establishes the procedures governing the hearing and 
appeal rights of any person alleged to be liable for civil penalties, 
clean-up costs and/or damages for mailing hazardous materials and/or 
related violations under 39 U.S.C. 3018.


Sec.  958.2  Definitions.

    (a) Complaint refers to the determination by the Determining 
Official that an individual has violated the prohibition against 
mailing hazardous materials and/or related violations under 39 U.S.C. 
3018.
    (b) Initial Decision refers to the written decision which the 
Presiding Officer renders.
    (c) Determining Official refers to the Chief Postal Inspector or 
designee.
    (d) Judicial Officer refers to the Judicial Officer or Acting 
Judicial Officer of the United States Postal Service or designee within 
the Judicial Officer Department.
    (e) Party refers to the Postal Service or the respondent.

[[Page 5138]]

    (f) Person refers to any individual, partnership, corporation, 
association, or private organization.
    (g) Presiding Officer refers to an Administrative Law Judge 
designated by the Judicial Officer to conduct a hearing.
    (h) Recorder refers to the Recorder of the Judicial Office of the 
United States Postal Service, 2101 Wilson Boulevard, Suite 600, 
Arlington, Virginia 22201-3078.
    (i) Representative refers to an attorney or other advocate.
    (j) Respondent refers to any person determined by the Determining 
Official to be liable for civil penalties, clean-up costs and/or 
damages for mailing hazardous materials and/or related violations under 
39 U.S.C. 3018.


Sec.  958.3  Petition for hearing.

    Within 30 days of being served the Postal Service's Complaint 
alleging liability under 39 U.S.C. 3018, the respondent may request a 
hearing by filing a written Hearing Petition with the Recorder. The 
respondent's Petition must include the following:
    (a) The words ``Petition for Hearing Related to Prohibitions 
Regarding the Mailing of Hazardous Material'' or other words reasonably 
identifying it as such;
    (b) The name of the respondent as well as his or her work and home 
addresses, and work and home telephone numbers; and other address and 
telephone number where the respondent may be contacted about the 
hearing proceedings;
    (c) The date on which the respondent received the Complaint issued 
by the Determining Official;
    (d) A statement indicating whether the respondent requests an oral 
hearing or a decision solely on the written record;
    (e) If the respondent requests an oral hearing, a statement 
proposing a city for the hearing site, with justification for holding 
the hearing in that city, as well as recommended dates for the hearing; 
and
    (f) A statement admitting or denying each of the allegations of 
liability made in the Complaint, and stating any defense on which the 
respondent intends to rely.


Sec.  958.4  Referral of complaint.

    (a) If the respondent fails to request a hearing within the 
specified period, the Determining Official shall transmit the Complaint 
to the Judicial Officer for referral to a Presiding Officer, who shall 
issue an Initial Decision based upon the information contained in the 
Complaint.
    (b) If the respondent files a Hearing Petition, the Determining 
Official, upon receiving a copy of the Petition, shall promptly 
transmit to the Presiding Officer a copy of the Postal Service's 
Complaint.


Sec.  958.5  Scope of hearing; evidentiary standard.

    (a) A hearing under this part shall be conducted by the Presiding 
Officer on the record (1) to determine whether the respondent is liable 
under 39 U.S.C. 3018, and (2) if so, to determine the amount of any 
civil penalties, clean-up costs and/or damages to be imposed.
    (b) The Postal Service must prove its case against a respondent by 
a preponderance of the evidence.
    (c) The parties may offer for insertion onto the record such 
relevant evidence as they deem appropriate and as would be admissible 
under the generally accepted rules of evidence applied in the courts of 
the United States in nonjury trials, subject, however, to the sound 
discretion of the Presiding Officer in supervising the extent and 
manner of presentation of such evidence. In general, admissibility will 
hinge on relevancy and materiality. However, relevant evidence may be 
excluded if its probative value is substantially outweighed by the 
danger of unfair prejudice, or by considerations of undue delay, waste 
of time, or needless presentation of cumulative evidence.


Sec.  958.6  Notice of docketing and hearing.

    (a) Within a reasonable time after receiving the respondent's 
Hearing Petition and the Complaint, the Presiding Officer shall serve 
upon the respondent and the Determining Official, a Notice of Docketing 
and Hearing.
    (b) The Notice of Docketing and Hearing required by paragraph (a) 
of this section may include:
    (1) The tentative site, date, and time of the oral hearing, if one 
is requested;
    (2) The legal authority and jurisdiction under which the hearing is 
to be held;
    (3) The nature of the hearing;
    (4) The matters of fact and law to be decided;
    (5) A description of the procedures governing the conduct of the 
hearing; and
    (6) Such other information as the Presiding Officer deems 
appropriate.


Sec.  958.7  Hearing location.

    An oral hearing under this part shall be held:
    (a) In the judicial district of the United States in which the 
respondent resides or transacts business;
    (b) In the judicial district of the United States in which the 
incident or incidents occurred upon which the determination of 
liability under 39 U.S.C. 3018 was made by the Determining Official; or
    (c) In such other place as may be determined by the Presiding 
Officer.


Sec.  958.8  Rights of parties.

    Subject to the sound discretion of the Presiding Officer, acting 
under Sec.  958.9, parties to a hearing under this part shall have the 
right:
    (a) To be accompanied, represented, and advised, by an attorney or 
representative of his or her own choosing;
    (b) To participate in any conferences held by the Presiding 
Officer;
    (c) To agree to stipulations of fact or law, which shall be made 
part of the record;
    (d) To make opening and closing statements at the oral hearing;
    (e) To present oral and documentary evidence relevant to the 
issues;
    (f) To submit rebuttal evidence;
    (g) To conduct such cross-examination as may be required for a full 
and true disclosure of the facts; and
    (h) To submit written briefs, proposed findings of fact, and 
proposed conclusions of law.


Sec.  958.9  Responsibilities and authority of presiding officer.

    (a) The Presiding Officer shall conduct a fair and impartial 
hearing, avoid unnecessary delay, maintain order, and assure that a 
record of the proceeding is made.
    (b) The Presiding Officer's authority includes, but is not limited 
to, the following:
    (1) Establishing, upon adequate notice to all parties, the date and 
time of the oral hearing, if any, as well as, in accordance with Sec.  
958.7, selecting the hearing site;
    (2) Holding conferences, by telephone or in person, to identify or 
simplify the issues, or to consider other matters that may aid in the 
expeditious resolution of the proceeding;
    (3) Continuing or recessing the hearing in whole or in part for a 
reasonable period of time;
    (4) Administering oaths and affirmations to witnesses;
    (5) Ruling on all offers, motions, requests by the parties, and 
other procedural matters;
    (6) Issuing any notices, orders, or memoranda to the parties 
concerning the proceedings;
    (7) Regulating the scope and timing of discovery;
    (8) Regulating the course of the hearing and the conduct of the 
parties and their representatives;
    (9) Examining witnesses;

[[Page 5139]]

    (10) Receiving, ruling on, excluding, or limiting evidence in order 
to assure that relevant, reliable and probative evidence is elicited on 
the issues in dispute, but irrelevant, immaterial or repetitious 
evidence is excluded;
    (11) Deciding cases, upon motion of a party, in whole or in part by 
summary judgment where there is no disputed issue of material fact;
    (12) Establishing the record in the case; and
    (13) Issuing a written Initial Decision containing findings of 
fact, conclusions of law, and determinations with respect to whether 
civil penalties, clean-up costs and/or damages for mailing hazardous 
materials and/or related violations under 39 U.S.C. 3018 should be 
imposed, and if so, the amounts thereof, after taking into account the 
penalty considerations contained in 39 U.S.C. 3018(e).


Sec.  958.10  Prehearing conferences.

    (a) At a reasonable time after issuing the Notice of Docketing and 
Hearing, and with adequate notice to the parties, the Presiding Officer 
may conduct, in person or by telephone, one or more prehearing 
conferences to discuss the following:
    (1) Simplification of the issues;
    (2) The necessity or desirability of amendments to the pleadings, 
including the need for a more definite statement;
    (3) Stipulations or admissions of fact or as to the contents and 
authenticity of documents;
    (4) Limitation of the number of witnesses;
    (5) Exchange of witness lists, copies of prior statements of 
witnesses, and copies of hearing exhibits;
    (6) Scheduling dates for the exchange of witness lists and of 
proposed exhibits;
    (7) Discovery;
    (8) Possible changes in the scheduled oral hearing date, time or 
site, if requested; and
    (9) Any other matters related to the proceeding.
    (b) Within a reasonable time after the completion of a prehearing 
conference, the Presiding Officer shall issue an order detailing all 
matters agreed upon by the parties, or ordered by the Presiding 
Officer, at such conference.


Sec.  958.11  Respondent's access to information.

    Except as provided in this paragraph, after receiving the Notice of 
Docketing and Hearing the respondent may review and obtain a copy of 
all relevant and material documents, transcripts, records, and other 
materials which relate to the determination of liability by the 
Determining Official under 39 U.S.C. 3018, and all exculpatory 
information in the possession of the Determining Official relating to 
liability for civil penalties, clean-up costs and/or damages for 
mailing hazardous materials and/or related violations under 39 U.S.C. 
3018. The respondent is not entitled to review or obtain a copy of any 
document, transcript, record, or other material which is privileged 
under Federal law. The Presiding Officer is authorized to issue orders 
placing limitations on the scope, method, time and place for accessing 
this information, and provisions for protecting the secrecy of 
confidential information or documents.


Sec.  958.12  Depositions; interrogatories; admission of facts; 
production and inspection of documents.

    (a) General policy and protective orders. The parties are 
encouraged to engage in voluntary discovery procedures. In connection 
with any discovery procedure permitted under this part, the Presiding 
Officer may issue any order which justice requires to protect a party 
or person from annoyance, embarrassment, oppression, or undue burden or 
expense. Such orders may include limitations on the scope, method, time 
and place for discovery, and provisions for protecting the secrecy of 
confidential information or documents. Each party shall bear its own 
expenses relating to discovery.
    (b) Depositions. After the issuance of a Notice of Docketing and 
Hearing, the parties may mutually agree to, or the Presiding Officer 
may, upon application of either party and for good cause shown, order 
the taking of testimony of any person by deposition upon oral 
examination or written interrogatories before any officer authorized to 
administer oaths at the place of examination, for use as evidence or 
for purposes of discovery. The application for an order of the 
Presiding Officer under this paragraph shall specify whether the 
purpose of the deposition is discovery or for use as evidence.
    (1) The time, place, and manner of taking depositions shall be as 
mutually agreed by the parties, or failing such agreement, governed by 
order of the Presiding Officer.
    (2) No testimony taken by depositions shall be considered as part 
of the record in the hearing unless and until such testimony is offered 
and received into evidence by order of the Presiding Officer. 
Deposition testimony will not ordinarily be received in evidence if an 
oral hearing is requested by either party, and the deponent is 
available to testify personally at the hearing. In such instances, 
however, deposition testimony may be used to contradict or impeach the 
testimony of the witness given at the hearing. In cases submitted for a 
decision on a written record, the Presiding Officer may, in his or her 
discretion, receive deposition testimony as evidence in supplementation 
of that record.
    (c) Interrogatories to parties. After the issuance of a Notice of 
Docketing and Hearing, a party may serve on the other party written 
interrogatories. Within 30 days after service, the party served shall 
answer each interrogatory separately in writing, signed under oath, or 
file objections thereto. Upon timely objection by the party, the 
Presiding Officer will determine the extent to which the 
interrogatories will be permitted.
    (d) Admission of facts. After the issuance of a Notice of Docketing 
and Hearing, a party may serve upon the other party a request for the 
admission of specified facts. Within 30 days after service, the party 
served shall answer each requested fact or file objections thereto. 
Upon timely objection by the party, the Presiding Officer will 
determine the extent to which the request for admission will be 
permitted. The factual propositions set out in the request shall be 
deemed admitted upon the failure of a party to respond to the request 
for admission.
    (e) Production and inspection of documents. Upon motion of a party 
showing good cause therefor, and upon notice, the Presiding Officer may 
order the other party to produce and permit the inspection and copying 
or photographing of any designated documents or objects, not 
privileged, specifically identified, and their relevance and 
materiality to the cause or causes in issue explained, which are 
reasonably calculated to lead to the discovery or admissible evidence. 
If the parties cannot themselves agree thereon, the Presiding Officer 
shall specify just terms and conditions in making the inspection and 
taking the copies and photographs.
    (f) Limitations. A discovery procedure may not be used to reach 
documents, transcripts, records, or other material which a person is 
not entitled to review pursuant to Sec.  958.11.


Sec.  958.13  Sanctions.

    (a) In general. The Presiding Officer may sanction a person, 
including any party, attorney or representative, for:
    (1) Failing to comply with a lawful order or prescribed procedure;
    (2) Failing to prosecute or defend an action; or

[[Page 5140]]

    (3) Engaging in other misconduct that interferes with the speedy, 
orderly, or fair conduct of the hearing.
    (b) Reasonableness. Any such sanction, including but not limited to 
those listed in paragraphs (c), (d), and (e) of this section, shall 
reasonably relate to the severity and nature of the failure or 
misconduct.
    (c) Failure to comply with an order. When a party fails to comply 
with an order, including an order for taking a deposition, the 
production of evidence within the party's control, or a request for 
admission, the Presiding Officer may:
    (1) Draw an inference in favor of the requesting party with regard 
to the information sought;
    (2) Prohibit such party from introducing evidence concerning, or 
otherwise relying upon, testimony relating to the information sought;
    (3) Permit the requesting party to introduce secondary evidence 
concerning the information sought; and
    (4) Strike any part of the pleadings or other submissions of the 
party failing to comply with such request.
    (d) Failure to prosecute or defend. If a party fails to prosecute 
or defend an action under this part, the Presiding Officer may dismiss 
the action, or enter an order of default and an Initial Decision.
    (e) Failure to file timely. The Presiding Officer may refuse to 
consider any motion or other pleading, report, or response which is not 
filed in a timely fashion.


Sec.  958.14  Ex parte communications.

    Communications between a Presiding Officer and a party shall not be 
made on any matter in issue unless on notice and opportunity for all 
parties to participate. This prohibition does not apply to procedural 
matters. A memorandum of any communication between the Presiding 
Officer and a party shall be transmitted by the Presiding Officer to 
all parties.


Sec.  958.15  Post-hearing briefs.

    Post-hearing briefs and reply briefs may be submitted upon such 
terms as established by the Presiding Officer at the conclusion of the 
hearing.


Sec.  958.16  Transcript of proceedings.

    Testimony and argument at oral hearings shall be reported verbatim, 
unless the Presiding Officer orders otherwise. Transcripts or copies of 
the proceedings may be obtained by the parties at such rates as may be 
fixed by contract between the reporter and the Postal Service.


Sec.  958.17  Initial decision.

    (a) After the conclusion of the hearing, and the receipt of briefs, 
if any, from the parties, the Presiding Officer shall issue a written 
Initial Decision, including his or her findings and determinations. 
Such decision shall include the findings of fact and conclusions of law 
which the Presiding Officer relies upon in determining whether the 
respondent is liable for civil penalties, clean-up costs and/or damages 
for mailing hazardous materials and/or related violations under 39 
U.S.C. 3018, and, if liability is found, shall set forth the amount of 
any civil penalties, clean-up costs and/or damages imposed.
    (b) The Presiding Officer shall promptly send to each party a copy 
of his or her Initial Decision. A party may, in accordance with Sec.  
958.18, appeal an adverse Initial Decision to the Judicial Officer. 
Unless a party timely appeals in accordance with Sec.  958.18, the 
Presiding Officer's Initial Decision, including the findings and 
determinations, becomes the final agency decision.


Sec.  958.18  Appeal of initial decision to Judicial Officer.

    (a) Notice of appeal and supporting brief. A party may appeal an 
adverse Initial Decision by filing, within 30 days after the Presiding 
Officer issues the Initial Decision, a Notice of Appeal with the 
Recorder. The Judicial Officer may extend the filing period but only if 
the party files a request for an extension within the initial 30-day 
period and demonstrates good cause for such extension.
    (1) The Notice of Appeal must be accompanied by a written brief 
specifying the party's exceptions, and any reasons for such exceptions, 
to the Presiding Officer's Initial Decision.
    (2) Within 30 days of receiving the party's brief, the opposing 
party may file with the Judicial Officer a response to the specified 
exceptions to the Presiding Officer's Initial Decision.
    (b) Form of review. Review by the Judicial Officer will be based 
entirely on the record and written submissions.
    (1) The Judicial Officer may affirm, reduce, reverse, or remand any 
determination about a penalty or assessment by the Presiding Officer.
    (2) The Judicial Officer shall not consider any argument or 
objection that was not raised in the hearing unless the interested 
party demonstrates that the failure to raise the argument or objection 
before the Presiding Officer was caused by extraordinary circumstances.
    (3) If any party demonstrates to the satisfaction of the Judicial 
Officer that additional evidence not presented at the hearing is 
material and that there were reasonable grounds for the failure to 
present such evidence, the Judicial Officer may remand the matter to 
the Presiding Officer for consideration of such additional evidence.
    (c) Decision of Judicial Officer. The Judicial Officer shall 
promptly serve each party to the appeal with a copy of his or her 
decision. The decision of the Judicial Officer constitutes final agency 
action and becomes final and binding on the parties.


Sec.  958.19  Form and filing of documents.

    (a) Every pleading filed in a proceeding under this part must 
contain a caption setting forth the title of the action, the docket 
number (after assignment by the Recorder), an accurate designation of 
the document, and the name, address, and telephone number of the party 
on whose behalf the paper was filed. It shall also be signed by the 
party or party representative submitting the document.
    (b) The original and three copies of all pleadings and documents in 
a proceeding conducted under this part shall be filed with the 
Recorder, Judicial Officer Department, United States Postal Service, 
2101 Wilson Boulevard, Suite 600, Arlington, Virginia 22201-3078. 
Normal Recorder business hours are between 8:15 a.m. and 4:45 p.m., 
eastern standard or daylight saving time. The Recorder will transmit a 
copy of each document filed to the other party, and the original to the 
Presiding Officer.
    (c) Pleadings or other document transmittals to, or communications 
with, the Postal Service, other than to the Recorder under paragraph 
(a) of this section, shall be made through the Determining Official or 
designated Postal Service attorney. If a notice of appearance by a 
representative is filed on behalf of the respondent, pleadings or 
document transmittals to, or communications with, the respondent shall 
be made through his or her representative.


Sec.  958.20  Service of notice of docketing and hearing, other 
documents.

    Unless otherwise specified, service of a Notice of Docketing and 
Hearing or any other document under this part shall be effected by 
registered or certified mail, return receipt requested, or by personal 
delivery. In the case of personal service, the person making service 
shall, if possible, secure from the party or other person sought to be 
served, or his or her agent, a written acknowledgement of receipt, 
showing the date and time of such receipt. If the person upon whom 
service is made declines to acknowledge receipt, the

[[Page 5141]]

person effecting service shall execute a statement, indicating the 
time, place and manner of service, which shall constitute evidence of 
service.


Sec.  958.21  Computation of time.

    In computing any period of time provided for by this part, or any 
order issued pursuant to this part, the time begins with the day 
following the act, event, or default, and includes the last day of the 
period, unless it is a Saturday, Sunday, or legal holiday observed by 
the Federal Government, in which event it includes the next business 
day. Except as otherwise provided in these rules or an applicable 
order, prescribed periods of time are measured in calendar days rather 
than business days.


Sec.  958.22  Continuances and extensions.

    Continuances and extensions may be granted under these rules for 
good cause shown.


Sec.  958.23  Settlement.

    Either party may make offers of settlement or proposals of 
adjustment at any time. The Determining Official has the exclusive 
authority to compromise or settle any determinations of liability for 
civil penalties, clean-up costs and/or damages for mailing hazardous 
materials and/or related violations under 39 U.S.C. 3018, without the 
consent of the Presiding Officer or Judicial Officer.

Stanley F. Mires,
Chief Counsel, Legislative.
[FR Doc. E9-1864 Filed 1-28-09; 8:45 am]
BILLING CODE 7710-12-P