[Federal Register Volume 75, Number 80 (Tuesday, April 27, 2010)]
[Rules and Regulations]
[Pages 22190-22202]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2010-9630]



[[Page 22189]]

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Part II





Postal Regulatory Commission





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39 CFR Parts 3001 and 3005



Obtaining Information From the Postal Service; Final Rule

  Federal Register / Vol. 75, No. 80 / Tuesday, April 27, 2010 / Rules 
and Regulations  

[[Page 22190]]


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POSTAL REGULATORY COMMISSION

39 CFR Parts 3001 and 3005

[Docket No. RM2009-12; Order No. 441]


Obtaining Information From the Postal Service

AGENCY:  Postal Regulatory Commission.

ACTION:  Final rule.

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SUMMARY:  The Commission is adopting a final rule on procedures for 
obtaining information from the Postal Service. Their adoption is 
consistent with Commission obligations under a recent change in law.

DATES:  Effective April 27, 2010.

FOR FURTHER INFORMATION CONTACT:  Stephen L. Sharfman, General Counsel, 
202-789-6820 or [email protected].

SUPPLEMENTARY INFORMATION: Regulatory History, 74 FR 51815 (October 8, 
2009).

Table of Contents

I. Introduction
II. Comments
III. Summary of Changes to Proposed Rules
IV. Discussion
V. Section-by-Section Analysis of the Rules
VI. Effective Date
VII. Ordering Paragraphs

I. Introduction

    In this order, the Postal Regulatory Commission (Commission) adopts 
rules governing (1) the issuance of subpoenas requiring officers, 
employees, agents, or contractors of the United States Postal Service 
(Covered Persons) to appear and present testimony or to produce 
documentary or other evidence; (2) the enforcement of Commission 
subpoenas by district courts of the United States; and (3) the issuance 
of orders requiring depositions and responses to written 
interrogatories by any of those same Covered Persons. These rules 
implement section 602 of the Postal Accountability and Enhancement Act 
(PAEA), Public Law 109-435, 120 Stat. 3198, December 20, 2006, which 
amended section 504 of title 39 of the United States Code by adding a 
new subsection 504(f) authorizing the issuance of subpoenas and the 
taking of depositions and responses to written interrogatories by 
certain persons.\1\
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    \1\ Section 601(a)(3) of the PAEA created section 504 by re-
designating then-existing section 3604 of title 39 as section 504.
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    Comments were solicited by Order No. 293.\2\ After careful 
consideration of the comments submitted, the Commission is adopting the 
proposed rules with several minor modifications, clarifications, and 
corrections.
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    \2\ Notice and Order of Proposed Rulemaking Concerning Obtaining 
Information From the Postal Service, September 2, 2009 (Order No. 
293).
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II. Comments

    The Commission received a total of five comments and reply comments 
on the proposed rules.\3\ In its comments, the Postal Service raises 
essentially five issues. First, it requests that the Commission revise 
proposed rule 12(c), which authorizes the summary issuance of subpoenas 
without a prior opportunity to provide information voluntarily.\4\ The 
suggested revision would require the Commission to make a good faith 
attempt to reach the Postal Service's General Counsel (or other 
authorized person) prior to invoking rule 12(c). Postal Service 
Comments at 1-2.
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    \3\ Comments of the Public Representative in Response to Notice 
and Order Concerning Information from the Postal Service (Public 
Representative Comments); United States Postal Service Comments in 
Response to Order No. 293 (Postal Service Comments); Valpak Direct 
Marketing Systems, Inc. and Valpak Dealers' Association, Inc. 
Initial Comments on Proposed Rulemaking Concerning Obtaining 
Information from the Postal Service (Valpak Comments), all filed on 
November 9, 2009; Valpak Direct Marketing Systems, Inc. and Valpak 
Dealers' Association, Inc. Reply Comments on Proposed Rulemaking 
Concerning Obtaining Information from the Postal Service, November 
23, 2009 (Valpak Reply Comments); and Reply Comments of American 
Postal Workers Union, AFL-CIO, November 24, 2009 (APWU Reply 
Comments). On November 25, 2009, APWU filed American Postal Workers' 
Union, AFL-CIO, Motion for Late Acceptance of Reply Comments. The 
motion is granted.
    \4\ The Postal Service has referred to discrete sections of 
proposed 39 CFR part 3005 as ``rules.'' To avoid confusion, that 
convention will be followed in this order.
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    Second, the Postal Service suggests two changes to the procedures 
set forth in proposed rule 13 that apply to third-party requests for 
subpoenas. The first change would prohibit a third party from 
requesting a subpoena to enforce a Commission (as opposed to a third-
party) information request. Id. at 2-3. The second proposed change 
would require third-party applicants for subpoenas to include in their 
application three certifications in addition to the certification that 
the Postal Service (or other subpoena target) had failed to comply with 
a Commission order directing the production of information. Id. at 3-4.
    Third, the Postal Service objects to the requirement in proposed 
rule 14(a) that places responsibility on the Postal Service for serving 
a subpoena on a third-party contractor. Id. at 4-9.
    Fourth, the Postal Service challenges the requirement in proposed 
rule 15(e) that the failure or refusal to produce electronically stored 
information on grounds of undue burden or cost must demonstrate that 
undue burden or cost by clear and convincing evidence. Id. at 9-12.
    Finally, the Postal Service suggests that the Commission clarify 
that proposed rule 31 will not apply to Commission proceedings.\5\ The 
purpose of this clarification would be to prevent the use of ``rule 
31'' as a means of circumventing the requirements contained in rule 33 
of the Commission's existing rules of practice. Id. at 13-14. 
Alternatively, the Postal Service requests that proposed rule 31 be 
modified to include the same requirements contained in rule 33 of the 
rules of practice. Id. at 14.
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    \5\ As the Postal Service correctly points out, the correct 
number of the proposed rule in subpart C of the proposed regulations 
is ``Sec.  3005.21,'' not ``Sec.  3005.31'' as set forth in the text 
of the rule. Id. at 12, n.21. The Postal Service nevertheless refers 
to this rule as ``rule 31'' in its comments. Id. at 12-14. APWU also 
refer to this rule as ``rule 31.'' See APWU Comments at 2. For 
consistency and to avoid confusion, the Commission refers to this 
rule as ``rule 31.'' The Commission is, however, correcting the 
erroneous number in the final version of the rules adopted by this 
order.
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    In its initial comments, Valpak states that the proposed 
regulations appear to conform to the Commission's statutory 
authorization, but urges a clarification to the subpoena form that was 
attached to Order No. 293. Valpak Comments at 2-3. Specifically, Valpak 
urges the Commission to revise the subpoena form by adding a field to 
identify the name of the report, if any, to which a subpoena 
applies.\6\ Id. at 3. The purpose of this change would be to ``ensure 
that the jurisdictional basis for each subpoena would be clarified at 
the outset.'' Id. In reply comments, Valpak opposes the Postal 
Service's attempt to preclude third parties from seeking subpoenas to 
enforce Commission information requests. Valpak Reply Comments at 1-3. 
Valpak also opposes the Postal Service's attempt to require additional 
certifications in third-party subpoena requests. Id. at 3-4.
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    \6\ The proposed subpoena form attached to Order No. 293 
included an analogous field for specifying the Commission proceeding 
to which a subpoena relates.
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    APWU objects to the changes proposed by the Postal Service to rule 
15 that relate to the showing of undue burden or cost required to 
justify a failure or refusal to disclose or provide electronically 
stored information. APWU Comments at 1-2. APWU also opposes the Postal 
Service's requested clarification regarding the application of proposed 
rule 31 to Commission proceedings, as well as the Postal Service's 
proposed alternative to modify proposed rule 31 to conform to rule 33 
of the rules of practice. Id. at 2-3.

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    The Public Representative states that the proposed rules appear to 
conform to the statutory requirements of 39 U.S.C. 504, but suggests 
several modifications and clarifications. Public Representative 
Comments at 8-9. First, the Public Representative suggests a 
modification to the provisions of proposed rule 11 that allow for the 
attachment to a subpoena of conditions deemed `` `necessary and 
appropriate under the circumstances presented.' '' Id. at 4-5. Second, 
the Public Representative suggests that the Commission revise proposed 
rule 12 to clarify the procedures or standards used to demonstrate that 
the Postal Service has been given an opportunity to provide information 
voluntarily (or that the Postal Service has failed to respond) before a 
subpoena is issued. Id. at 5-6.
    Third, the Public Representative suggests that the Commission 
consider changes in the procedures under proposed rule 13 by which the 
Postal Service would confirm that a Covered Person does not object to a 
subpoena. The Public Representative also suggests that the Commission 
consider modifications that ensure a Covered Person's right to state 
his objections to a subpoena request directly to the Commission, not 
through the Postal Service. Id. at 6-7.
    Fourth, the Public Representative suggests that comparisons to the 
Federal Rules of Civil Procedure or the adoption of analogous 
provisions may, in limited instances, be of benefit to the Commission 
and parties to Commission proceedings. Id. at 7.
    Finally, the Public Representative states its support for the use 
in an adjudicatory proceeding of proposed rule 31 as an alternative to 
the procedures in part 3001 of the rules of practice for compelling 
discovery. Id. at 7-8.

III. Summary of Changes to Proposed Rules

    As discussed below, the Commission is making the following changes 
to its proposed rules:
    Rule 13 is modified to require Postal Service confirmation that 
requests for subpoenas have been transmitted to third-party agents or 
contractors.
    Rule 14 is modified to revise the Postal Service's responsibilities 
for transmitting subpoenas to Covered Persons. As modified, the Postal 
Service will be responsible for transmitting subpoenas to persons 
currently holding positions with the Postal Service (such as officers 
and employees), to persons or entities currently acting as agents for 
the Postal Service, or to persons serving as a Postal Service 
contractor under an existing contract. In addition, the proposed rule 
will be modified to eliminate any Postal Service responsibility for 
transmitting subpoenas to former officers, employees, agents, and 
contractors. Instead, the person who requested the subpoena and, in 
some cases, the Commission, will be responsible for serving subpoenas 
on former officers, employees, agents, and contractors.
    Rule 14(b) is modified to state expressly the Commission's 
authority to extend the time for filing a return of service of a 
subpoena.
    Rule 15(e) is revised by removing the requirement that a refusal to 
produce electronically stored information must be justified by ``clear 
and convincing evidence.'' Rule 15(e) is replaced by additions to rules 
12 (governing summarily issued subpoenas) and 13 (governing subpoenas 
requested by third parties) that require opponents of subpoenas to 
state ``with particularity'' the reasons why a subpoena would be unduly 
burdensome or costly.
    The subpoena form is modified by adding a placeholder for ``Report 
Name-If Applicable.'' The proposed form already has a placeholder for 
``Case Name-If Applicable.''
    Finally, the Commission redesignates rule 31 as rule 21 and 
clarifies the relationship between rule 21 and existing rule 33 of the 
rules of practice.
    In all other respects, the Commission adopts the rules as proposed 
in Order No. 293.

IV. Discussion

    The final rules adopted by this order establish a new part 3005 
organized in three subparts. Subpart A integrates part 3005 into the 
Commission's existing rules and regulations by making various existing 
rules applicable to part 3005. Subpart B establishes regulations 
governing the issuance and enforcement of subpoenas under the authority 
of sections 504(f)(2)(A) and 504(f)(3). Finally, subpart C implements 
section 504(f)(2)(B) of title 39, which authorizes the Commission to 
order depositions and responses to written interrogatories. The 
regulations in both subpart B and subpart C apply to Covered Persons. 
The term ``covered persons'' is defined in subsection 504(f)(4) of 
title 39.
    The comments filed in this proceeding address six of the proposed 
rules and the subpoena form proposed as Appendix A to part 3005. Those 
six proposed rules are rule 11, rule 12, rule 13, rule 14, rule 15, and 
rule 31.
    Rule 11(d) Conditions placed on subpoenas. The Public 
Representative proposes a modification to rule 11(d) to clarify that 
conditions imposed on a subpoena by the Commission are in conformity 
with statutory and other applicable authorities under which the 
Commission functions. Public Representative Comments at 4-5. The Public 
Representative makes this proposal because she finds ambiguity in 
phraseology of rule 11 as proposed. As proposed, rule 11(d) would 
permit the attachment of conditions to a subpoena that are ``necessary 
and appropriate under the circumstances presented.''
    The Commission recognizes that any conditions attached to a 
subpoena must be authorized by law and consistent with statutory 
authorities under which the Commission operates. Subpoena conditions 
must also reflect the specific need for information and the 
circumstances in which the subpoena is issued. The Commission believes 
that the requirement in rule 11(d) that subpoena conditions be 
``necessary and appropriate'' implicitly includes an obligation to 
attach conditions that are in conformance with the legal authorities 
under which the Commission functions. The change proposed by the Public 
Representative could be interpreted as a limitation on the Commission's 
discretion and thereby undermine, rather than foster, the attachment of 
lawful conditions. The Commission therefore finds the formulation of 
rule 11(d), as proposed, to be appropriate and rejects the Public 
Representative's suggested modification.
    Rule 12(c) Subpoenas issued summarily by the Commission. The Postal 
Service requests that rule 12 be modified to require the Commission to 
make a good faith attempt to reach its General Counsel or other 
appropriate person before invoking the provisions of rule 12(c) under 
which a subpoena may be issued summarily without a prior opportunity to 
provide information voluntarily.
    The Commission does not believe that such a change is necessary or 
desirable. Rule 12 addresses situations in which a subpoena can be 
issued without the prior receipt of a third-party request. In other 
words, the Chairman, a designated Commissioner, or an administrative 
law judge appointed under 5 U.S.C. 3105 could seek authorization from 
the full Commission for the issuance of a subpoena. Rule 12(b) provides 
that, with a limited exception provided in rule 12(c), the Postal 
Service would be given the opportunity to provide the information 
voluntarily before the subpoena is issued. The exception provided in 
rule 12(c) is expressly limited to situations in which ``a delay in the 
issuance of the subpoena could unreasonably limit or prevent

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production of the information being sought.''
    Given the limited applicability of rule 12(c), the Commission does 
not believe the modification proposed by the Postal Service is 
necessary. In addition to the express limitations that rule 12 places 
on its own operation, the Commission noted its expectation in the 
analysis section to Order No. 293 that ``the summary issuance of a 
subpoena [would] rarely, if ever, be necessary....'' Order No. 293 at 
18.
    Moreover, the Commission does not believe that the proposed 
modification would necessarily be desirable since neither the 
Commission, nor the Postal Service, can contemplate all of the possible 
situations in which the summary issuance of a subpoena might be deemed 
necessary. Notwithstanding its decision to reject the proposed change 
to rule 12, the Commission will certainly, as a matter of comity, 
consider informal notification to the Postal Service's General Counsel 
or other appropriate person prior to the summary issuance of a subpoena 
if such prior notification appears feasible.
    The Public Representative proposes a further and slightly different 
modification to rule 12 that would apply to situations in which the 
Postal Service has been given an opportunity to provide information 
voluntarily. Specifically, the Public Representative suggests that 
clarification is needed to ``provide some standard for evidence of the 
Postal Service's receipt of an opportunity to respond voluntarily as 
well as evidence showing that it has failed to respond.'' Public 
Representative Comments at 5-6.
    The Commission is not persuaded that this clarification is 
necessary. Any proposal by the Chairman, a designated Commissioner, or 
an administrative law judge for the issuance of a subpoena must in all 
cases be affirmatively approved by a majority of the Commissioners. See 
proposed rule 11(b). Except for subpoenas issued under the authority of 
rule 12(c), the Commissioners must decide that the Postal Service has 
had an opportunity to provide the information voluntarily. Whether or 
not such an opportunity has been provided will depend upon the specific 
facts and circumstances surrounding the attempt to obtain the 
information. Not all such facts and circumstances are readily 
predictable. This makes the formulation of an evidentiary standard or 
evidentiary requirements suggested by the Public Representative 
problematic and therefore undesirable. If further experience 
demonstrates the need for, and feasibility of, such clarifications, the 
Commission will consider the adoption of a specific proposal.
    Rule 13 Eligibility to make third-party requests for subpoenas and 
contents of the request. The Postal Service seeks two changes to rule 
13. First, it seeks to eliminate the right of third parties to request 
subpoenas to enforce a Commission information request. Postal Service 
Comments at 2-3. In support of this proposed modification, the Postal 
Service argues that, as proposed, rule 13 ``allows participants to prod 
the Commission as to its own information requests. Whether and how to 
enforce a Commission information request is a matter between the 
Commission and the Postal Service.'' Id. In the view of the Postal 
Service, this ``would produce little clear benefit'' and would threaten 
``to embroil participants in the Commission's exercise of 
discretion....'' Id. at 3. Valpak opposes the Postal Service's 
suggestion. Valpak Reply Comments at 1-3.
    The Commission does not view the possibility that third parties 
might seek enforcement of a Commission information request as a threat 
to the exercise of its discretion. Moreover, if the Commission were to 
preclude third parties from seeking subpoenas to enforce a Commission 
information request, this could prompt third-party attempts to preserve 
their right to request subpoenas by making duplicative requests for 
information that merely track outstanding Commission information 
requests. Finally, if the concerns articulated by the Postal Service 
materialize, the Commission can always amend its rules to restrict the 
right of third parties to seek enforcement of Commission information 
requests.
    As an alternative to its first proposed change, the Postal Service 
proposes an amendment to rules 13(c)(4) and 13(c)(5) that would require 
third-party applicants for subpoenas to provide more than a 
certification that the Postal Service has failed to comply with a 
Commission order. Postal Service Comments at 3-4. Specifically, the 
Postal Service requests that persons requesting subpoenas be required 
to include in their requests a description of the efforts of the Postal 
Service (or other subpoena target) to respond; to await passage of a 
specified period of time following issuance of an order or reply 
deadline before requesting a subpoena; and to provide the subpoena 
target's response to an inquiry from the applicant as to whether a 
response would be forthcoming. Id. at 3-4. Once again, Valpak opposes 
the Postal Service's suggestion. Valpak Reply Comments at 3-4.
    The Commission is not persuaded that this second change should be 
made. The person in the best position to describe the efforts of the 
subpoena target to respond to a discovery order or information request 
is the subpoena target, not the person requesting the subpoena. 
Moreover, if additional time is needed to respond to a discovery order 
or information request, the target of the subpoena is free to request 
additional time.
    Finally, the obligation to state that a response will be 
forthcoming after a response deadline is an obligation of the 
responding party whether or not the requesting party inquires as to the 
status of the response effort. In those situations in which a formal 
response deadline has not been established or in which efforts to 
respond are not ``visible externally,''\7\ any person who requests a 
subpoena without first checking the status of the response effort will 
do so at his own peril, since subpoenas cannot be issued automatically 
upon request. They require formal approval by the Commission. If the 
Postal Service (or other responding party) is still engaged in a good 
faith process of responding, that fact will undoubtedly be communicated 
to the Commission in the responder's answer to the subpoena request 
pursuant to rule 13(a)(3), and the requesting party risks that its 
request will be summarily denied.
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    \7\ See Postal Service Comments at 3, n.3.
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    Rule 13 Responses to third-party requests for subpoenas. Proposed 
rule 13 governs requests by third parties for the issuance of 
subpoenas. Rule 13(a) covers situations in which hearings have been 
ordered. Rule 13(b) governs situations in which hearings have not been 
ordered. As proposed, both rule 13(a) and 13(b) make the Postal Service 
responsible for notifying the Covered Person of the request and for 
transmitting any objections it might have.
    The Public Representative makes two suggestions. First, she 
suggests that the Postal Service be required to provide proof that it 
has notified the Covered Person of the subpoena request. Second, the 
Public Representative suggests that some Covered Persons, such as 
Postal Service contractors, should be given the opportunity to respond 
directly to the subpoena request. Public Representative Comments at 6. 
The Commission agrees with both suggestions.
    With regard to the first suggestion, the Commission concludes that 
it would be useful to require the Postal Service to identify the 
persons to whom it has given notification of the subpoena request. 
While the Commission has no

[[Page 22193]]

doubt that the Postal Service will provide such third-party 
notifications, it would be useful for the Commission, the requesting 
party, and other interested persons to have information regarding the 
recipients of such notifications. While the requesting party may be 
aware of at least one Covered Person who possesses or controls relevant 
information, identification of additional persons who the Postal 
Service knows or believes possess or control the information being 
requested will foster the efficient operation of the proposed 
regulations. To ensure that such additional sources are identified, the 
Commission is revising rule 13(a)(2) to require the Postal Service to 
identify such sources and provide relevant contact information. Similar 
changes are being made to rule 13(b)(1).
    With regard to the Public Representative's second suggestion 
regarding the right of Covered Persons to respond to a subpoena 
request, the Commission never intended to preclude a Covered Person 
from submitting its own answer without the assistance of the Postal 
Service. To eliminate any misunderstanding and to reduce administrative 
burdens on the Postal Service, the Commission is modifying and 
clarifying rule 13(a)(3) and rule 13(b)(2) in two ways. First, the 
Commission is eliminating any Postal Service responsibility for 
transmitting a Covered Person's objections to the request for subpoena. 
Second, both proposed subsections of rule 13 are revised to include 
Covered Persons among those who are eligible to answer a request for 
subpoena. Together, these two changes will make it clear that Covered 
Persons are permitted to submit their own answers to subpoena requests. 
In making these changes, the Commission recognizes that the Postal 
Service remains an interested party and therefore will be eligible to 
file its own answer to a request for a subpoena directed to a third 
party.
    Rule 14 Service of subpoenas on third-party contractors. The Postal 
Service objects to the proposed requirement in rule 14(a) that it 
transmit and deliver Commission subpoenas to contractors or agents 
outside the Postal Service.\8\ Id. at 4-9. It argues that the proposed 
procedure appears to be unnecessary, is without precedent, and raises 
potentially serious constitutional issues. Id. The Postal Service also 
explains that because of the complexities involved in serving foreign 
entities, it may not be possible to file a return of service within 2 
days of a subpoena's issuance. Id. at 8.
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    \8\ The Postal Service also seems to interpret the proposed 
rules as imposing an obligation on the Postal Service regarding the 
Covered Person's ``responsiveness'' to the subpoena. Postal Service 
Comments at 5. However, the proposed rules already make clear that 
compliance with a subpoena is the responsibility of the Covered 
Person. See proposed rule 15. Accordingly, the Commission need not 
address the Postal Service's request that the Commission provide in 
its rules that the Postal Service has no liability for responses to 
a subpoena by an entity having only a contractual relationship with 
the Postal Service. See id. at 9.
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    Section 504(f)(2)(A) grants the authority ``to issue subpoenas 
requiring the attendance and presentation of testimony by, or the 
production of documentary or other evidence in the possession of, any 
covered person....'' [emphasis added]. A ``covered person'' is ``an 
officer, employee, agent, or contractor of the Postal Service.'' 
Section 504(f)(4).
    As formulated, section 504(f) does not authorize the issuance of 
subpoenas to the Postal Service itself, but to officers, employees, 
agents, and contractors of the Postal Service. Information sought from 
a Covered Person must be related to a proceeding or request related to 
the Postal Service.\9\ Given the Postal Service's obvious interest in 
attempts to subpoena information from its officers, employees, agents, 
and contractors, the Commission has provided in rule 14 that subpoenas 
be served upon the Postal Service and its General Counsel and other 
representatives authorized to receive legal process regardless of which 
officer, employee, agent, or contractor is the ultimate target of the 
subpoena.\10\
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    \9\ Section 504(f)(2) authorizes the issuance of subpoenas 
``with respect to any proceeding conducted by the Commission under 
this title [i.e., title 39] or to obtain information to be used to 
prepare a report under this title [i.e., title 39]....''
    \10\ For that same reason, the Commission has authorized the 
Postal Service to address subpoenas and subpoena requests regardless 
of which Covered Person is the target of the subpoena. See rules 12 
and 13.
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    The Postal Service objects to its obligation to transmit a subpoena 
on five grounds. First, the Postal Service argues that the Commission 
is equally capable of knowing which of the Covered Persons is likely to 
have possession of the information being sought. Second, it argues that 
it ``cannot be accountable for independent third parties' behavior or 
responsiveness with respect to their own proprietary information.'' 
Postal Service Comments at 5. Third, it argues that service on an 
entity through an independent third party (in this case, the Postal 
Service) can implicate an entity's due process rights. Id. at 6. 
Fourth, the Postal Service asserts that it is unaware of any Federal or 
administrative procedures that permit substituted service of subpoenas. 
Id. Finally, it argues that Congress has not indicated its intent to 
have the Postal Service play a role in the service of Commission 
subpoenas. Id. 6-7.
    Contrary to the Postal Service's first contention, the Commission 
may not necessarily be able to ascertain the identity of Covered 
Persons in possession of relevant information at the time a subpoena is 
issued. For example, when the Postal Service is provided an opportunity 
under rule 12 to produce information voluntarily, a subpoena could be 
issued without the identity of the appropriate Covered Person or 
Covered Persons being known to the Commission.\11\ The Commission's 
inability to identify appropriate Covered Persons could also occur 
because of a Postal Service refusal voluntarily to provide both the 
requested information and the identities of the Covered Persons in 
possession of the information. Rule 14 would address such a situation 
by requiring the Postal Service to transmit the subpoena to each 
Covered Person needed to obtain the information. Without rule 14's 
provisions for transmitting subpoenas to the relevant Covered Persons, 
the Commission might first have to issue one or more subpoenas just to 
ascertain the identity of the relevant Covered Persons.\12\
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    \11\ Such a situation could also arise in cases under rule 12(c) 
in which it is not possible to provide the Postal Service with an 
opportunity to produce information voluntarily before resorting to 
the issuance of a subpoena.
    \12\ The problem of identifying Covered Persons would not be 
presented in Federal district courts. Fed. R. Civ. P. rule 26(a) 
requires, inter alia, that parties must, without awaiting a 
discovery request, provide the names, addresses, and phone numbers 
of individuals likely to have discoverable information. The 
Commission's current rules of practice contain no such requirement.
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    The Postal Service's second argument is that it should not be held 
accountable for the response of a third party, such as a Postal Service 
agent or contractor, to a Commission subpoena that might seek 
information that is arguably proprietary. This concern is misplaced. 
The proposed rules already make clear that compliance with a subpoena 
is the responsibility of the Covered Person. See rule 15. In that 
connection, the Commission would point out that claims for confidential 
treatment can be made by any Covered Person. See proposed rule 15(f). 
Accordingly, it is unnecessary for the Commission to address the Postal 
Service's request that the Commission provide in its rules that the 
Postal Service has no liability for responses to a subpoena by an 
entity having only a contractual relationship with the Postal Service. 
See Postal Service Comments at 9.

[[Page 22194]]

    As its third argument, the Postal Service asserts that transmission 
of a subpoena by the Postal Service to a Covered Person could violate 
the Covered Person's due process rights.\13\ Id. at 6. The Commission 
is not persuaded by this argument. In the first place, the cases cited 
by the Postal Service all involve some type of substituted, 
alternative, or constructive service which either did not, or might 
not, result in notice actually being given to the intended recipient of 
process.\14\ Without notice of process, the intended recipient of 
process would be denied the opportunity to be heard, which, as the 
Postal Service recognizes, is `` `the essential element of due process 
of law....' '' Postal Service Comments at 6 citing Jacob, 223 U.S. at 
265-66. By contrast, under the provisions of rule 14, the Postal 
Service would actually transmit the Commission subpoena to the Covered 
Person and the Covered Person would be able to respond directly to the 
Commission.
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    \13\ The Postal Service's argument addresses situations in which 
the Covered Person to whom the subpoena is directed is a Postal 
Service agent or contractor. The Postal Service makes no due process 
objection to the Commission's proposal that subpoenas be transmitted 
by the Postal Service to its officers and employees. It therefore 
appears that the Postal Service sees no due process problem with 
transmission of a subpoena by the Postal Service to one of its 
officers or employees. The basis for this distinction is not 
provided.
    \14\ E.g., Jacob v. Roberts 223 U.S. 261 (1912) (service by 
publication); Mulhane v. Central Hanover Bank & Trust Co., 339 U.S. 
306 (1950) (service by publication); and Calabro v. Leiner, 464 
F.Supp.2d 470 (E.D. Pa. 2006) (alternative service). It should be 
noted that some of the very cases cited by the Postal Service upheld 
the constitutionality of substituted or alternative service. See 
Jacob, 223 U.S. at 267; and Mulhane, 339 U.S. at 318.
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    Historically, judicial subpoenas required personal service by an 
officer of the court, such as a marshal or deputy marshal.\15\ Over 
time, these service requirements have been relaxed by a number of 
courts. Id. at 399-400. In the view of these courts, it is the delivery 
of the subpoena and actual notice of what is being demanded of the 
person being subpoenaed that is the touchstone of due process and the 
obligation to respond. From the standpoint of due process, there 
appears to be nothing unusual about personal service by an officer of 
the court.\16\
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    \15\ 9A Charles Alan Wright and Arthur R. Miller, Federal 
Practice and Procedure, Sec.  2454 at 397 (Civil 3d. 2002 and Supp. 
2008) (Wright and Miller).
    \16\ Indeed, at least one Federal court has noted that even 
under Fed. R. Civ. P. rule 45, there is no specific requirement for 
personal service of a subpoena. All that the rule requires is 
``delivery'' to the person being served. Ultradent Prods., Inc. v. 
Hayman, D.C.N.Y. 2002, 2002 WL 31119425, *3 (Patterson, J.). as 
cited in Wright and Miller, Sec.  2454, n.10.
---------------------------------------------------------------------------

    The fourth ground for opposing rule 14's service mechanism is that 
the Commission has failed to identify any other Federal or 
administrative precedent that supports substituted service of a 
subpoena. The short answer to this contention is, as noted above, that 
the Commission's proposed mechanism for service does not constitute 
substituted service. Whereas substituted service typically involves 
delivery to a person's place of work when the person is not present, 
delivery to an address by certified or registered mail, or posting of a 
notice in a public place, and publication in a newspaper,\17\ the 
Commission's proposed rule 14 provides for transmission of a subpoena 
by the Postal Service to the particular person responsible for 
responding. This is actual service, not substituted service. Adoption 
of the proposed mechanism in rule 14 does not depend upon a 
justification for substituted service.
---------------------------------------------------------------------------

    \17\ See 62B Am. Jur.2d Process Sec.  143.
---------------------------------------------------------------------------

    Finally, the Postal Service argues that Congress has not expressed 
an intent that the Postal Service play a role in the service of 
Commission subpoenas. The Commission agrees. But neither does section 
504(f) prohibit the Commission's proposed method of service. In light 
of the more recent judicial developments identified above and in 
further view of the absence of specific congressional direction 
regarding the manner in which Commission subpoenas must be served, the 
Commission continues to believe that its proposed method for serving 
subpoenas on outside Postal Service contractors and agents implements 
section 504(b) reasonably and effectively. This is particularly true 
when the Postal Service has an agency or contractual relationship with 
the Covered Person at the time the subpoena is issued. In such cases, 
the requirement that the Postal Service transmit the subpoena to its 
agent or contractor is similar to transmission by the Postal Service of 
a subpoena to one of its own officers or employees. Because of its 
existing relationships with agents and contractors, the Postal Service 
is in the best position to accomplish transmission of the subpoena to 
an agent or contractor.
    Without the requirement that the Postal Service transmit the 
subpoena to its agent or contractor, more formal and potentially time 
consuming methods would be required.\18\ If, for some unexpected 
reason, the Postal Service is unable to locate or transmit the subpoena 
to the appropriate recipient, it can so advise the Commission and an 
alternate and more traditional means of service can be employed.
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    \18\ In some cases, this could require the Commission to involve 
the assistance of a United States Attorney or the Justice Department 
in serving the subpoena. There appears to be no need for such 
additional complexity given that the agency or contractor 
relationship will be an existing relationship and the fact that the 
agent or contractor will be able to assert any objections or claims 
of privilege or confidentiality directly to the Commission. See 
rules 12 and 13.
---------------------------------------------------------------------------

    By contrast, if, at the time a subpoena is issued, the Postal 
Service no longer has an agency or contractual relationship with the 
third-party agent or contractor, it may no longer be in any better 
position to transmit the subpoena than the third party who requested 
the subpoena or the Commission itself. Accordingly, the Commission is 
revising proposed rule 14 to eliminate the requirement that the Postal 
Service transmit a subpoena to a former agent or contractor. Service on 
such Covered Persons will be the responsibility of either the third 
party who requested the subpoena or the Commission.
    While the service requirements for outside Covered Persons, such as 
former Postal Service agents or contractors, will be modified, the 
Commission expects the Postal Service to provide subpoenaed information 
to which the Postal Service has contractual or other proprietary rights 
whether or not such information is in the physical possession of the 
Postal Service at the time a subpoena is issued. It is the Commission's 
understanding that the Postal Service does not oppose that position. 
See Postal Service Comments at 7, n.13. Similarly, the Commission 
expects the Postal Service to provide all relevant subpoenaed 
information that is under its physical control at the time a subpoena 
is issued, even if that information is information of an outside 
Covered Person, such as a Postal Service contractor.\19\
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    \19\ The third-party contractor would, of course, have the 
opportunity to oppose production of such information, either by 
opposing a third-party request for a subpoena made under rule 13 or 
by filing a motion to quash a subpoena that is issued summarily 
under rule 12.
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    Rule 15(e) Standard for opposing production of electronically 
stored information. The Postal Service expresses concern that the 
formulation of proposed rule 15(e) establishes a ``high bar to cost-
based objections...[that] would lead to severe imbalances between the 
probative value of requested information and the cost inflicted on the 
Postal Service.'' Id. at 9. As an alternative, the Postal Service 
requests the Commission to adopt a standard akin to Fed R. Civ. P. rule 
26(b)(2)(C). Id. at 12. Fed. R. Civ. P. rule 26 provides general 
provisions for discovery in Federal district courts and is expressly 
referred to in Fed. R. Civ. P. rule 45(d), the rule that sets forth 
duties in responding to judicial

[[Page 22195]]

subpoenas. APWU opposes the Postal Service's request and urges the 
Commission to adopt rule 15(e) as proposed. APWU Comments at 1-2.
    The concern expressed by the Postal Service focuses primarily on 
the requirement in proposed rule 15(e) that to justify the failure or 
refusal to provide discovery of electronically stored information, the 
Postal Service (or other Covered Person) must show ``by clear and 
convincing evidence'' that the burden or cost of production is undue. 
See Postal Service Comments at 10-11. The Postal Service argues that a 
more appropriate standard would be a ``preponderance of the evidence.'' 
Id. Implicit in the Postal Service's argument is also an assumption 
that a determination of whether a burden or cost was ``undue'' would 
not involve a balancing of competing considerations (such as the cost 
of producing the requested information, the importance of the issues, 
and the importance of the requested discovery in resolving the issues), 
as would occur in Federal district court under Fed. R. Civ. P. rule 
26(b)(2)(C).\20\ APWU responds by pointing out that proposed rule 11, 
which makes provision for attaching conditions to a subpoena, should 
provide adequate protection to the Postal Service. APWU Comments at 2.
---------------------------------------------------------------------------

    \20\ The Commission would note that its rules of practice, which 
are applicable to the subpoena process by rule 1(b), do not 
currently contain a rule analogous to Fed. R. Civ. P. rule 26. The 
Commission has, however, from time to time relied on the principles 
embodied in Fed. R. Civ. P. rule 26. See, e.g., Order No. 381, 
Docket No. C2009-1, Order Affirming Presiding Officer's Ruling 
C2009-1/12, January 7, 2010, at 11-12. In the current context, the 
Postal Service's reference to Fed. R. Civ. P. rule 26(b)(2)(C) is 
appropriate.
---------------------------------------------------------------------------

    In proposing rule 15(e), the Commission was not attempting to 
require the production of information without regard to cost, burden, 
or consideration of other relevant factors of the type discussed by the 
Postal Service. What the Commission was attempting to make clear was 
that it would not accept vague and unsubstantiated claims of burden or 
cost as justification for failing or refusing to provide necessary 
information. Indeed, cost and other relevant factors should be given 
due consideration in the process of considering the attachment of 
conditions to a subpoena, as APWU suggests.
    Upon consideration of the points presented by the Postal Service 
and APWU, the Commission concludes that the appropriate context for 
resolving claims of burden, cost, and protective conditions is before 
the Covered Person responds to a subpoena. Accordingly, the Commission 
is removing subsection (e) from proposed rule 15 and is modifying 
proposed rules 12 and 13 as described below.
    Proposed rule 12 covers situations in which subpoenas are issued 
without a third-party request. Subsection (d) of that rule will be 
modified by requiring that motions to quash, limit, or condition a 
subpoena that allege undue burden or cost must state with particularity 
the basis for such a claim.\21\ Similar requirements will be added to 
proposed rules 13(a)(3) and 13(b)(2). Those latter subsections provide 
for answers to third-party requests for subpoenas. By requiring the 
issues of undue burden and cost be addressed prior to the compliance 
stage, participants (including the Postal Service and Covered Persons) 
will be able to address all relevant factors that relate to alleged 
costs and burdens in a more timely manner that will hopefully foster 
compliance. As APWU suggests, applicable conditions, if any, can be 
attached prior to issuance of the subpoena.
    Rule 31 \22\ Deposition orders. As enacted, 39 U.S.C. 504(f)(2)(B) 
authorizes the Chairman of the Commission, any Commissioner designated 
by the Chairman, and any administrative law judge appointed by the 
Commission under 5 U.S.C. 3105 to order the taking of depositions and 
responses to written interrogatories by a Covered Person. Proposed rule 
31 closely follows the text of section 504(f)(2)(B).
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    \21\ The requirement that the showing of undue burden or cost be 
made ``with particularity'' avoids unintended implications of the 
``clear and convincing evidence'' standard. The requirement of a 
showing ``with particularity'' is also consistent with the 
Commission's existing rules of practice. See 39 CFR 3001.26, 
3001.27, and 3001.28.
    \22\ See n.5, supra.
---------------------------------------------------------------------------

    The Postal Service acknowledges that, as proposed, rule 31 directly 
tracks the provisions of section 504(f)(2)(B). Postal Service Comments 
at 12. However, it is concerned that, without clarification, rule 31 
could be used to circumvent certain restrictions contained in rule 33 
of the Commission's existing rules of practice. That latter rule is 
limited in its application to Commission proceedings. Id. at 13.
    The Postal Service proposes that the Commission clarify that 
parties who seek information or testimony that they believe would be 
useful in Commission proceedings should pursue discovery under the 
rules of practice (which would include rule 33 of the rules of 
practice), not proposed rule 31 that is being adopted pursuant to 
section 504(f)(2)(B). Id. at 13-14. Alternatively, the Postal Service 
requests that the Commission clarify that proposed rule 31 is subject 
to the same conditions applicable to discovery under rule 33 of the 
rules of practice.
    APWU opposes the Postal Service's suggested clarifications. APWU 
Comments at 2-3. The Public Representative agrees with the Commission's 
statement in Order No. 293 that the authority embodied by proposed rule 
31 ``can be used within the scope of an adjudicatory hearing as an 
alternative to the procedures in part 3001 [the Commission's rules of 
practice] for compelling discovery.'' Public Representative Comments at 
8.
    In light of these divergent views, clarification is in order. It is 
useful, first, to summarize the background against which the rule is 
being proposed. The Commission's rules of practice apply to proceedings 
before the Commission. See 39 CFR 3001.3. In those proceedings, 
participants have the opportunity to propound written interrogatories 
to other participants or to request the Commission for authorization to 
take the deposition of a witness. See 39 CFR 3001.26 and 3001.33. 
Historically, a refusal to respond to a written interrogatory or to 
appear at a deposition presented a serious problem for the Commission. 
Although rule 26(g) provided for the issuance of orders compelling 
responses to written interrogatories, there were, on occasion, 
situations in which the Postal Service refused to comply with such an 
order. See Order No. 293 at 4, n.3. Rule 33 governing depositions 
presented a similar problem in that the rule did not include provision 
for compelling appearance for a deposition.
    Against this background, Congress enacted section 504(f)(2)(B). 
This new section provides the authority for ordering the taking of 
depositions and responses to written interrogatories by a Covered 
Person. Thus, in a proceeding in which the Commission has authorized a 
deposition in response to an application made pursuant to rule 33 of 
the rules of practice, the Commission can, by virtue of section 
504(f)(2)(B) and proposed rule 31, compel a Covered Person to appear 
for the deposition. Similarly, in a Commission proceeding, the 
Commission can compel a Covered Person to respond to written 
interrogatories propounded under rule 26 of the rules of practice.
    In addition, the authority provided by section 504(f)(2)(B) and 
proposed rule 31 empowers the Chairman, a Commissioner designated by 
the Chairman, or an administrative law judge appointed under 5 U.S.C. 
3105, sua sponte, to order depositions and responses to written 
interrogatories,

[[Page 22196]]

even if no participant in a Commission proceeding has requested such a 
deposition or propounded such a written interrogatory.
    Such depositions and responses can also be ordered sua sponte when 
no proceeding is pending. Section 504(f)(2)(B) authorizes the Chairman, 
a Designated Commissioner, or an administrative law judge to order 
depositions and responses to written interrogatories in order to obtain 
information to be used to prepare reports under title 39. This 
authority also goes beyond the scope of a Commission proceeding.
    From the Commission's perspective, proposed rule 31 is a mechanism 
for enforcing discovery in Commission proceedings and for pursuing, sua 
sponte, discovery and information needed to prepare reports by means of 
either depositions or written interrogatories.
    It was with the foregoing situations in mind that the Commission 
stated in Order No. 293 that ``the authority to issue orders under 
section 504(f)(2)(B) can...be exercised in the context of an 
adjudicatory hearing as an alternative to the procedures in part 3001 
for compelling discovery...[and that an] order can also be issued under 
section 504(f)(2)(B) outside the context of a Commission proceeding.'' 
Id. at 16.
    Appendix A to part 3005--Subpoena form. Valpak proposes that the 
subpoena form attached as Appendix A to Order No. 293 be revised to add 
a field to specify a report for which information is sought. Valpak 
Comments at 2-3. Valpak makes this suggestion to ``ensure that the 
jurisdictional basis for each subpoena would be clarified at the 
outset'' and, presumably, to guard against the unauthorized use of the 
Commission's subpoena power. Id. at 3.
    The Commission accepts Valpak's suggested modification to the 
subpoena form. Whether or not the Commission has the authority to issue 
specific subpoenas will depend upon the facts and circumstances 
surrounding the issuance of those subpoenas and upon their formulations 
and purposes. Additional relevant information on the subpoena form may 
eliminate confusion and reduce controversy.

V. Section-By-Section Analysis of the Rule

    Section 3001.3 Scope of rules. The amendment to rule 3 of the rules 
of practice clarifies that the rules of practice apply both to 
proceedings before the Commission and to the procedures in part 3005 
for compelling the production of information by the Postal Service. 
This change is consistent with the inclusion in part 3005 of references 
to specific rules of practice.
    Section 3005.1 Scope of rules. This proposed rule states that part 
3005 implements 39 U.S.C. 504(f). It also makes applicable the rules of 
practice in part 3001, unless otherwise ordered by the Commission.
    Section 3005.2 Terms defined. This proposed rule provides 
definitions for the terms ``administrative law judge,'' ``Chairman,'' 
``covered person,'' and ``designated Commissioner'' as used in part 
3005.
    Section 3005.11 General rule--subpoenas. This proposed rule sets 
forth the basic requirements for the issuance of a subpoena pursuant to 
39 U.S.C. 504(f)(2)(A). Subpoenas may only be issued by the Chairman, a 
designated Commissioner, or an administrative law judge. When 
authorized in writing by a majority of the Commissioners then in 
office, a subpoena shall be issued by the Chairman, a designated 
Commissioner, or an administrative law judge. This rule also lists the 
purposes for which a subpoena may be issued; the types of conditions or 
limitations that may be imposed on the subpoena to protect the 
recipient of the subpoena from oppression, undue burden, or expense, 
including the possible imposition of confidentiality or non-disclosure 
conditions as provided in 39 CFR part 3007; and identifies the rule 
that establishes the service requirements for a subpoena. A proposed 
subpoena form is provided as Appendix A to Part 3005-Subpoena Form.
    Section 3005.12 Subpoenas issued without receipt of a third-party 
request. This proposed rule provides for the issuance of a subpoena 
without a request having been received from a third party. For example, 
the Commission could deem a subpoena necessary if the Postal Service 
were to refuse to provide information during preliminary review of a 
Postal Service filing. Or a subpoena could be needed if the Postal 
Service were to refuse to provide information needed for the 
preparation of a report. Finally, a presiding officer might deem it 
necessary to obtain the issuance of a subpoena to enforce a presiding 
officer's information request. In such cases, there would be no ``third 
party'' request for the subpoena.
    From a procedural standpoint, the request would be made directly to 
the full Commission by a Commissioner or presiding officer. To insure 
that the Postal Service and other interested persons, including Covered 
Persons potentially affected by the subpoena, have an opportunity to 
oppose the subpoena, or to limit or condition its scope and operation, 
any duly authorized subpoena would be subject to a motion under rule 
21(a) to quash, limit, or condition the subpoena. Replies to such a 
motion could be made by any interested person under rule 21(b).
    In the vast majority of circumstances, Covered Persons would be 
given an opportunity to produce information voluntarily before a 
subpoena is issued under this section. However, provision is also made 
for the summary issuance of a subpoena without issuance of a prior 
information request. While the Commission would expect the summary 
issuance of a subpoena to rarely, if ever, be necessary, it is 
including provision for such summary issuance in order to insure the 
ability to act promptly if necessary. In such cases, the recipient of 
the subpoena and other interested persons, would have an opportunity 
following issuance of the subpoena to file a motion to quash the 
subpoena, limit its scope, or to place conditions on the subpoena. 
Motions alleging undue burden or cost would be required to state with 
particularity the basis for any such claim. Pending resolution of the 
motion, Covered Persons would be required to maintain the information 
being sought by the subpoena.
    Section 3005.13 Subpoenas issued in response to a third-party 
request. This proposed rule establishes procedures by which subpoenas 
can be requested by third parties. One set of procedures applies to 
those situations in which the Commission has ordered hearings. 
Typically, in those cases the subpoena will be available as a means of 
enforcing the discovery rules in part 3001 of the Commission's rules of 
practice. A second set of procedures applies to situations in which no 
hearings have been ordered, such as an annual compliance review. In 
these cases, information will typically be sought by means of 
information requests, including information requests that have been 
proposed by a third party and issued by the Commission or a 
Commissioner. In this latter situation, a third party would be able to 
request the issuance of a subpoena to enforce the information request. 
Requests under either procedure must include certain minimum showings 
and demonstrations in order to be granted, including showings of 
relevance of the information and adequate specification of the 
information requested.
    The rule has been revised to require the Postal Service to provide 
the name, business address and phone number of any persons to whom the 
Postal Service transmits the subpoena request.

[[Page 22197]]

    Covered Persons expected to produce the requested information will 
have an opportunity to present any objections to the issuance of a 
subpoena. All objections, including allegations of undue burden or 
cost, must state with particularity the basis for such claims.
    Section 3005.14 Service of subpoenas. This proposed rule specifies 
the manner in which subpoenas are to be served. The Commission 
originally proposed that subpoenas be served initially upon the Postal 
Service with the requirement that the Postal Service transmit and 
deliver the subpoena to the officer, employee, agent, or contractor 
ultimately responsible for testifying or for otherwise providing the 
information being sought. The Commission has retained that procedure 
when information is sought from existing Postal Service officers, 
employees, and from those agents and contractors having an agency or 
contractual relationship at the time the subpoena is issued. However, 
the Commission has revised the service requirements to provide for 
personal service by the Commission (or by third parties who requested 
the subpoena) upon former Postal Service officers, employees, agents, 
or contractors. Conforming changes have been made to the provisions 
governing proof of service upon the Postal Service and Covered Persons 
and proof of transmission by the Postal Service to Covered Persons.
    Changes have also been made to provide for shorter or longer return 
periods as may be ordered by the Commission in specific cases. The 
provision for longer return of service periods has been made, in part, 
to accommodate longer periods that may be needed to accomplish service 
upon foreign persons or entities. Finally, revisions have been made to 
the provisions of notice to the public of service, proof of 
transmission, and the return date of the subpoena.
    Section 3005.15 Duties in responding to a subpoena. This proposed 
rule specifies the manner in which the recipient of a subpoena will be 
required to respond to the subpoena. It covers such subjects as the 
form in which documentary information is to be produced; the manner in 
which electronically stored information is to be produced; and the 
showing that must be made if information is not disclosed on grounds of 
privilege, confidentiality, or trade secret. Requests for confidential 
treatment of information produced in response to a subpoena are to be 
made in the manner provided in part 3007 of the Commission's 
regulations. Removed from the final rule is proposed Sec.  3005.15(e). 
That section had required that claims of undue burden or cost made to 
support a failure or refusal to produce electronically stored 
information be supported by clear and convincing evidence. In place of 
that section, modifications have been made to Sec. Sec.  3005.12(d), 
3005.13(a)(3), and 3005.13(b)(2). Those latter modifications require 
that any claim of undue burden or cost made in motions to quash, limit, 
or condition a subpoena, or in answers in opposition to requests for 
subpoenas must be supported by a particularized showing of the basis 
for such claims.
    Section 3005.16 Enforcement of subpoenas. This proposed rule 
implements the authority in 39 U.S.C. 504(f)(3) under which the 
Commission can seek judicial enforcement of an administrative subpoena 
issued pursuant to 39 U.S.C. 504(f)(2)(A).
    Section 3005.21 Authority to order depositions and responses to 
written interrogatories. This proposed rule implements the authority of 
the Chairman, any designated Commissioner, or any administrative law 
judge to order that a deposition be taken of a Covered Person or that 
the Covered Person respond to a written interrogatory.

VI. Effective Date

    Generally, a rule becomes effective not less than 30 days after 
publication in the Federal Register. 5 U.S.C. 553(d). A rule may become 
effective sooner if it is an interpretative rule, a statement of 
policy, or if the agency finds good cause to make it effective sooner. 
Id. Since the rules promulgated by this order are being adopted after 
public notice and opportunity for comment, procedures that are not 
statutorily required for the adoption of procedural rules, the 
Commission finds that good cause exists to make the rules promulgated 
by this order effective upon their publication in the Federal Register.

VII. Ordering Paragraphs

    It is ordered:
    1. The Commission hereby adopts the final rules for obtaining 
information from the Postal Service that follow the Secretary's 
signature as part of 39 CFR part 3005.
    2. The Commission hereby adopts conforming rule changes to 39 CFR 
part 3001 that follow the Secretary's signature.
    3. These rules shall take effect upon publication of this order in 
the Federal Register.
    4. The Secretary shall arrange for publication of this order in the 
Federal Register.

List of Subjects

39 CFR Part 3001

    Administrative practice and procedure, Postal Service.

39 CFR Part 3005

    Administrative practice and procedure, Confidential business 
information, Postal Service, Reporting and recordkeeping requirements.

    By the Commission.
Shoshana M. Grove,
Secretary.
    For the reasons discussed in the preamble, the Postal Regulatory 
Commission amends chapter III of title 39 of the Code of Federal 
Regulations as follows:

Part 3001-RULES OF PRACTICE AND PROCEDURE

0
1. The authority citation for part 3001 is revised to read as follows:

    Authority: 39 U.S.C. 404(d); 503; 504; 3661.

0
2. Revise Sec. 3001.3 to read as follows:


Sec. 3001.3  Scope of rules.

    The rules of practice in this part are applicable to proceedings 
before the Postal Regulatory Commission under the Act, including those 
which involve a hearing on the record before the Commission or its 
designated presiding officer and, as specified in part 3005 of this 
chapter to the procedures for compelling the production of information 
by the Postal Service. They do not preclude the informal disposition of 
any matters coming before the Commission not required by statute to be 
determined upon notice and hearing.

0
3. Add part 3005 to read as follows:

PART 3005--PROCEDURES FOR COMPELLING PRODUCTION OF INFORMATION BY 
THE POSTAL SERVICE

Subpart A-General
Sec.
3005.1 Scope and applicability of other parts of this title.
3005.2 Terms defined for purposes of this part.
Subpart B--Subpoenas
3005.11 General rule--subpoenas.
3005.12 Subpoenas issued without receipt of a third-party request.
3005.13 Subpoenas issued in response to a third-party request.
3005.14 Service of subpoenas.
3005.15 Duties in responding to a subpoena.
3005.16 Enforcement of subpoenas.

[[Page 22198]]

Subpart C--Depositions and Written Interrogatories
3005.21 Authority to order depositions and responses to written 
interrogatories.

Appendix A to Part 3005--Subpoena Form

    Authority: Authority: 39 U.S.C. 503; 504; 3651(c); 3652(d).

Subpart A--General


Sec.  3005.1  Scope and applicability of other parts of this title.

    (a) The rules in this part govern the procedures for compelling the 
production of information by the Postal Service pursuant to 39 U.S.C. 
504(f).
    (b) Part 3001, subpart A, of this chapter applies unless otherwise 
stated in this part or otherwise ordered by the Commission.


Sec.  3005.2  Terms defined for purposes of this part.

    (a) Administrative law judge means an administrative law judge 
appointed by the Commission under 5 U.S.C. 3105.
    (b) Chairman means the Chairman of the Commission.
    (c) Covered person means an officer, employee, agent, or contractor 
of the Postal Service.
    (d) Designated Commissioner means any Commissioner who has been 
designated by the Chairman to act under this part.

Subpart B--Subpoenas


Sec.  3005.11  General rule-subpoenas.

    (a) Subject to the provisions of this part, the Chairman, any 
designated Commissioner, and any administrative law judge may issue a 
subpoena to any covered person.
    (b) The written concurrence of a majority of the Commissioners then 
holding office shall be required before any subpoena may be issued 
under this subpart. When duly authorized by a majority of the 
Commissioners then holding office, a subpoena shall be issued by the 
Chairman, a designated Commissioner, or an administrative law judge.
    (c) Subpoenas issued pursuant to this subpart may require the 
attendance and presentation of testimony or the production of 
documentary or other evidence with respect to any proceeding conducted 
by the Commission under title 39 of the United States Code or to obtain 
information for preparation of a report under that title.
    (d) Subpoenas issued pursuant to this subpart shall include such 
conditions as may be necessary or appropriate to protect a covered 
person from oppression, or undue burden or expense, including the 
following:
    (1) That disclosure may be had only on specified terms and 
conditions, including the designation of the time or place;
    (2) That certain matters not be inquired into, or that the scope of 
disclosure be limited to certain matters;
    (3) That disclosure occur with no one present except persons 
designated by the Commission;
    (4) That a trade secret or other confidential research, 
development, or commercial information not be revealed or be revealed 
only in a designated way as provided in part 3007 of this chapter; and
    (5) Such other conditions deemed necessary and appropriate under 
the circumstances presented.
    (e) Subpoenas shall be served in the manner provided by Sec.  
3005.14.


Sec.  3005.12  Subpoenas issued without receipt of a third-party 
request.

    (a) A subpoena duly authorized by a majority of the Commissioners 
then holding office may be issued by the Chairman, a designated 
Commissioner, or an administrative law judge under Sec.  3005.11 
without a request having been made by a third party under Sec.  
3005.13.
    (b) Except as provided in paragraph (c) of this section, a subpoena 
shall not be issued until after the covered person has been provided an 
opportunity to produce the requested information voluntarily.
    (c) A subpoena may be issued summarily without first providing an 
opportunity to produce the requested information voluntarily if a delay 
in the issuance of the subpoena could unreasonably limit or prevent 
production of the information being sought.
    (d) Subpoenas issued under this section shall be issued subject to 
the right of the Postal Service and other interested persons to file a 
motion pursuant to Sec.  3001.21(a) of this chapter to quash the 
subpoena, to limit the scope of the subpoena, or to condition the 
subpoena as provided in Sec.  3005.11(d). Such motion shall include any 
objections to the subpoena that are personal to the covered person 
responsible for providing the information being sought. Motions 
alleging undue burden or cost must state with particularity the basis 
for such claims. Answers to the motion may be filed by any interested 
person pursuant to Sec.  3001.21(b) of this chapter. Pending the 
resolution of any such motion, the covered person shall secure and 
maintain the requested information.


Sec.  3005.13  Subpoenas issued in response to a third-party request.

    (a) Procedure for requesting and issuing subpoenas when hearings 
have been ordered. A participant in any proceeding in which a hearing 
has been ordered by the Commission may request the issuance of a 
subpoena to a covered person pursuant to Sec.  3005.11.
    (1) Subpoenas may be requested to enforce an order to compel 
previously issued pursuant to the rules of practice with which the 
Postal Service has failed to comply.
    (2) Requests for subpoenas under this section shall be made by 
written motion filed with the presiding officer in the manner provided 
in Sec.  3001.21 of this chapter. The Postal Service shall transmit a 
copy of the request to any covered person that it deems likely to be 
affected by the request and shall provide the person requesting the 
subpoena with the name, business address and business phone number of 
the persons to whom the request has been transmitted.
    (3) Answers to the motion may be filed by the Postal Service, by 
any person to whom the Postal Service has transmitted the request, and 
by any other participant. Answers raising objections, including 
allegations of undue burden or cost, must state with particularity the 
basis for such claims. Answers shall be filed as required by Sec.  
3001.21(b) of this chapter.
    (4) The presiding officer shall forward copies of the motion and 
any responses to the Commission together with a recommendation of 
whether or not the requested subpoena should be issued and, if so, the 
scope and content thereof and conditions, if any, that should be placed 
on the subpoena. Copies of the presiding officer's recommendation shall 
be served in accordance with Sec.  3001.12 of this chapter.
    (5) Following receipt of the materials forwarded by the presiding 
officer, the Commissioners shall determine whether the requested 
subpoena should be issued and, if so, whether any conditions should be 
placed on the scope or content of the subpoena or on the responses to 
the subpoena. The Commissioners may, but are not required, to entertain 
further oral or written submissions from the Postal Service or the 
participants before acting on the request. In making their 
determination, the Commissioners are not bound by any recommendation of 
a presiding officer.
    (b) Procedure for requesting and issuing subpoenas when no hearings 
have been ordered. Any person may request the issuance of a subpoena to 
a covered person pursuant to Sec.  3005.11 to

[[Page 22199]]

enforce an information request issued by the Commission or a 
Commissioner even though no hearings have been ordered by the 
Commission.
    (1) A request for the issuance of a subpoena shall be made by 
motion as provided by Sec.  3001.21 of this chapter. A copy of the 
request shall be served upon the Postal Service as provided by Sec.  
3001.12 of this chapter and by forwarding a copy to the General Counsel 
of the Postal Service, or such other person authorized to receive 
process by personal service, by Express Mail or Priority Mail, or by 
First-Class Mail, Return Receipt requested. The Postal Service shall 
transmit a copy of the request to any covered person that it deems 
likely to be affected by the request and shall provide the person 
requesting the subpoena with the name, business address and business 
phone number of the persons to whom the request has been transmitted. 
Proof of service of the request shall be filed with the Secretary by 
the person requesting the subpoena. The Secretary shall issue a notice 
of the filing of proof of service and the deadline for filing answers 
to the request.
    (2) Answers to the motion may be filed by the Postal Service, by 
any person to whom the Postal Service has transmitted the request, and 
by any other person. Answers raising objections, including allegations 
of undue burden or cost, must state with particularity the basis for 
such claims. Answers shall be filed as required by Sec.  3001.21(b) of 
this chapter.
    (3) Following receipt of the request and any answers to the 
request, the Commissioners shall determine whether the requested 
subpoena should be issued and, if so, whether any conditions should be 
placed on the scope or content of the subpoena or on the responses to 
the subpoena. The Commissioners may, but are not required, to entertain 
further oral or written submissions before acting. A majority of the 
Commissioners then holding office must concur in writing before a 
subpoena may be issued.
    (c) Contents of requests for subpoenas. Each motion requesting the 
issuance of a subpoena shall include the following:
    (1) A demonstration that the subpoena is being requested with 
respect to a proceeding conducted by the Commission under title 39 of 
the United States Code or that the purpose of the subpoena is to obtain 
information to be used by the Commission to prepare a report under 
title 39 of the United States Code;
    (2) A showing of the relevance and materiality of the testimony, 
documentary or other evidence being sought;
    (3) Specification with particularity of any books, papers, 
documents, writings, drawings, graphs, charts, photographs, sound 
recordings, images, or other data or data compilations stored in any 
medium from which information can be obtained, including, without 
limitation, electronically stored information which is being sought 
from the covered person;
    (4) In situations in which a hearing has been ordered, the request 
must include in addition to the information required by paragraphs 
(c)(1), (2) and (3) of this section, a certification that the covered 
person has failed to comply with an order compelling discovery 
previously issued pursuant to the Commission's rules of practice; and
    (5) In situations in which a hearing has not been ordered, the 
request must include in addition to the information required by 
paragraphs (c)(1), (2) and (3) of this section, an explanation of the 
reason for the request and the purposes for which the appearance, 
testimony, documentary or other evidence is being sought, and a 
certification that the Postal Service has failed to comply with a 
previously issued Commission order or information request.


Sec.  3005.14  Service of subpoenas.

    (a) Manner of service. (1) Existing Postal Service officers and 
employees. In addition to electronic service as provided by Sec.  
3001.12(a) of this chapter, subpoenas directed to existing Postal 
Service officers and employees must be served by personal service upon 
the General Counsel of the Postal Service or upon such other 
representative of the Postal Service as is authorized to receive 
process. Upon receipt, the subpoena shall be transmitted and delivered 
by the Postal Service to the existing officers and employees 
responsible for providing the information being sought by the subpoena. 
Subpoenas served upon the Postal Service and transmitted to Postal 
Service officers and employees shall be accompanied by a written notice 
of the return date of the subpoena.
    (2) Existing Postal Service agents and contractors. In addition to 
electronic service as provided by Sec.  3001.12(a) of this chapter, 
subpoenas directed to existing Postal Service agents and contractors 
must be served by personal service upon the General Counsel of the 
Postal Service or upon such other representative of the Postal Service 
as is authorized to receive process. Upon receipt, the subpoena shall 
be transmitted and delivered by the Postal Service to existing agents 
and contractors responsible for providing the information being sought 
by the subpoena. Service upon such agents and contractors shall be 
accompanied by a written notice of the return date of the subpoena.
    (3) Prior Postal Service officers, employees, agents, and 
contractors. Subpoenas directed to Postal Service officers, employees, 
agents, and contractors who, at the time the subpoena is issued, are no 
longer officers or employees of the Postal Service or are no longer 
agents or contractors in an existing agency or contract relationship 
with the Postal Service, must be served by personal service. Service 
upon such officers, employees, agents, or contractors shall be 
accompanied by a written notice of the return date of the subpoena.
    (4) Service arrangements. Arrangements for service upon the Postal 
Service under Sec. Sec.  3001.14(a)(1) or 14(a)(2) of this chapter or 
upon former Postal Service officers, employees, agents, or contractors 
under Sec.  3001.14(a)(3) of this chapter shall be arranged either by 
the Commission or by the third party who requested issuance of the 
subpoena.
    (b) Return of service and proof of transmission. (1) Return of 
service. Proof of service under Sec.  3001.14(a) of this chapter must 
be filed with the Secretary within 2 business days following service, 
unless a shorter or longer period is ordered by the Commission, and 
must be accompanied by certifications of:
    (i) The manner, date, and time of delivery of the subpoena;
    (ii) The name, business address, telephone number, and e-mail 
address of the perseon upon whom the subpoena was served; and
    (iii) The return date of the subpoena.
    (2) Proof of transmission. The Postal Service shall within 2 
business days of transmission of a subpoena by the Postal Service to an 
existing Postal Service officer, employee, agent, or contractor 
pursuant to Sec. Sec.  3001.14(a)(i) or (ii) of this chapter, or such 
shorter or longer period ordered by the Commission, file with the 
Secretary a certification of:
    (i) The manner, date, and time of delivery of the subpoena;
    (ii) The name, business address, telephone number, and e-mail 
address of the person to whom the subpoena was transmitted; and
    (iii) The return date of the subpoena.
    (c) Notice of service, proof of transmission, and return date. The 
Secretary shall post a notice of service and proof of transmission upon 
the Commission's Web site which specifies the return date of the 
subpoena.

[[Page 22200]]

Sec.  3005.15  Duties in responding to a subpoena.

    (a) A covered person responding to a subpoena to produce documents 
shall produce them as they are kept in the usual course of business or 
shall organize and label them to correspond with the categories in the 
subpoena.
    (b) If a subpoena does not specify the form or forms for producing 
electronically stored information, a covered person responding to a 
subpoena must produce the information in a form or forms in which the 
covered person ordinarily maintains it or in a form or forms that are 
reasonably usable.
    (c) A covered person responding to a subpoena need not produce the 
same electronically stored information in more than one form.
    (d) A covered person commanded to produce and permit inspection or 
copying of designated electronically stored information, books, papers, 
or documents need not appear in person at the place of production or 
inspection unless commanded to appear for deposition, hearing, or 
trial.
    (e) A covered person who fails or refuses to disclose or provide 
discovery of information on the grounds that the information is 
privileged or subject to protection as a trade secret or other 
confidential research, development, or commercial information must 
expressly support all such claims and shall provide a description of 
the nature of the information and the potential harm that is sufficient 
to enable the Commission to evaluate and determine the propriety of the 
claim.
    (f) Request for confidential treatment of information shall be made 
in accordance with part 3007 of this chapter.


Sec.  3005.16  Enforcement of subpoenas.

    In the case of contumacy or failure to obey a subpoena issued under 
this subpart, the Commission may apply for an order to enforce its 
subpoena as permitted by 39 U.S.C. 504(f)(3).

Subpart C--Depositions and Written Interrogatories


Sec.  3005.21  Authority to order depositions and responses to written 
interrogatories.

    The Chairman, any designated Commissioner, or any administrative 
law judge may order the taking of depositions and responses to written 
interrogatories by a covered person with respect to any proceeding 
conducted under title 39 of the United States Code or to obtain 
information to be used to prepare a report under that title.
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[[Page 22201]]

Appendix A to Part 3005--Subpoena Form
[GRAPHIC] [TIFF OMITTED] TR27AP10.000


[[Page 22202]]


[GRAPHIC] [TIFF OMITTED] TR27AP10.001

[FR Doc. 2010-9630 Filed 4-26-10; 8:45 am]
BILLING CODE 7710-FW-C