UPS Overcharge Class Case Revived

United Parcel Service got an unwelcome delivery from a federal appeals court, which revived class actions by companies claiming they were charged expensive air shipment rates for packages sent on the ground.

The 9th U.S. Circuit Court of Appeals on Friday revived multiple class actions from California, Colorado and Georgia saying the trial court dismissed the claims before deciding which state law applied.

The nonprecedential ruling said U.S. District Judge George Wu in San Diego simply assumed California law would apply to the four class action lawsuits.

The panel held that Wu must reconsider which state law governs in each particular lawsuit before it decides the merits of the UPS request for dismissal of the class actions.

“The district court should have addressed choice of law and conflict of law before making a determination on the merits of UPS’s dismissal motions,” the panel said.

Several businesses sued UPS in 2010 for breach of contract alleging the company systematically overcharged customers by selling “Next Day Air” services while actually providing them with lower-cost ground shipping.

The charge for air shipments can be up to three times more than ground fees.

Wu dismissed the case in 2011 after concluding the “Next Day Air” and “Second Day Air” were simply labels and not part of the contract terms for air service.

Judges Stephen Reinhardt, Mary Murguia and visiting Judge Donald Molloy of Montant were on the panel.

Case:  In re: United Parcel Service “Air-in-Ground” Marketing Litigation, No. 11-56478


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