April 6, 2000

Emery Worldwide Airlines went to the U.S. Court of Federal Claims to
complain about $123.7 million that they claim USPS owes them.

We know the Service is discussing both the renewal and expansion of Emery'sPMPC contract.  
Presumably this filing does not help.

A short article on the matter can be found at http://www.trafficworld.com

Phillip Tabbita
Special Assistant to President
American Postal Workers Union, AFL-CIO
1300 L ST NW
Washington DC 20005-4107
202 842-4273
202 371-0992 FAX
PTabbita@psinet.com

Emery files suit against USPS

CNF Transportation isn't kidding around. 
After threatening for months, CNF subsidiary Emery Worldwide Airlines filed a formal complaint against 
the U.S. Postal Service in the U.S. Court of Federal Claims. 
The complaint, which dates back to August 1998, is over USPS's refusal to honor an agreed 
upon rate for which Emery should be paid for handling Priority Mail on the East Coast. 
CNF contends USPS owes $123.7 million through the end of 1999 in unrecognized receipts. 
While the 1997 contract was hailed as groundbreaking, 
the contract has been full of headaches for Emery and CNF's stock. 
CNF has threatened to walk away from the contract if USPS won't revise its payment scheme to meet Emery's costs. 
Emery runs 10 Priority Mail Processing Centers for USPS along with a number of aircraft dedicated to Priority Mail.
"We view the decision to take the USPS to court as evidence that CNF 
management is feeling the pressure to unlock value and provide catalyst for 
the stock," said Bear Sterns analyst Edward M. Wolfe. 
At CNF there is still hope the rate case will be settled outside the courtroom so energies 
can be focused on the contract, rather than finances.

By Kristin S. Krause