
FedEx Overcharged Customers for Years, Sealed E-Mail Says - uptown
http://www.bloomberg.com/news/2012-12-11/fedex-overcharged-customers-for-years-sealed-e-mail-says.html
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rsbrown
There are businesses whose sole offering is a service to audit your shipping
invoices to ensure that you are not being overcharged. One, started in Memphis
in the late 90s to specifically audit FedEx deliveries, is now a division of
IronData:

<http://transportation.irondata.com>

~~~
bdcravens
I guess it'd be remiss of me to not link to Refund Retriever, the company I've
developed software for:

<http://www.refund-retriever.com>

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Shivetya
This would be an issue if they were the only game in town, last time I checked
they have some pretty stiff competition in package delivery, UPS being the one
that comes to mind.

Look at it this way, if they are overcharging for delivery but are still
getting business then they are charging appropriately for their market.

~~~
nickpinkston
Well, assuming there's no price collusion, which there's a good chance of the
implicit type. "Charging appropriately" isn't the best measure pro-socially,
AIDS medication was still selling well in the West as millions died.

FedEx could be prohibiting whole business models that are waiting to be
profitable with cheaper shipping.

Yes, I know it's speculation, but what we often forget here is that capitalism
is a deal of state-based enforcement of your property rights so that you
create value for society. If your company, like Comcast, is systematically
overcharging / under-delivering, you're not holding up your end of the deal -
so the state might just step in to ::realign your interests::

~~~
Gormo
> we often forget here is that capitalism is a deal of state-based enforcement
> of your property rights so that you create value for society.

Are you saying that the protection of one's property rights is contingent upon
the delivery of some arbitrary metric of "value" to "society"? That doesn't
sound quite right.

~~~
meepmorp
> Are you saying that the protection of one's property rights is contingent
> upon the delivery of some arbitrary metric of "value" to "society"? That
> doesn't sound quite right.

Are you saying that property rights are not contingent on a metric of value to
society? If it weren't better for society as a whole to provide protections
for property rights, do you think they'd exist?

~~~
sageikosa
>capitalism is a deal of state-based enforcement of your property rights so
that you create value for society

No it isn't. Capitalism is a "system" of capital investment (usually with the
expected gains of personal profitability), contingent upon the property rights
of the ownership of capital and transferable (partial) ownership of an
enterprise that consumes that capital.

Capitalism is contingent on property rights being recognized and defended
against arbitrary taking, but property rights are not contingent upon the
owner of property contributing to society in some arbitrarily (im?)measurable
way.

This is not to state that the protection of property rights is not a net
social boon, just that property rights do not evaporate (in whole or in part)
in specific instances once someone calculates the "social value" for an owned
enterprise has dropped below some immeasurable threshold.

Governments operating under a system of justice attempt to regulate the
systems and boundaries of social exchange (to minimize and resolve apparent
conflicts), but do not _require_ any party to engage in such exchange to the
benefit of anyone, or the mutual benefit of society.

~~~
nickpinkston
You start describing parts of how the deal works, but not the de jure or de
facto reality of its intention and operation in the real world.

>property rights do not evaporate...

It's called the Sherman Act in the US, and it's why Microsoft was told what to
do with their property - similar to MSFTs forced debundling in Europe. It's
the state saying "You're outside of the deal, make these changes (to your
property) to increase competition, which we know will costing you lots of
money (i.e. property)".

There are many other laws that regulate anti-competitive behavior, eminent
domain, patent violation in times of war, etc. that are all pro-social but
sacrifice property rights.

~~~
sageikosa
I also mention that this is how a government built on a system of justice
works, I do not claim to place that moniker "de facto" on any particular
government (in whole or in part).

Rights don't come from the state, they are a consequence of individuals
needing to be able to act upon long range plans while interacting with others,
and to be assured that values they have acquired will still be at their
disposal in the future. One only needs rights to things one plans to use when
other potential users may contend for it. Relying on a social order that
defends rights is in one's best long-range interests.

Laws that define and penalize "anti-competitive" behavior are orthogonal to
capitalism, in that capitalism isn't about competition, it is about investment
and return. From a legal standpoint (principles of justice notwithstanding),
the remedy for anti-trust behavior is rationalized not as a complete
termination of property rights (destruction or redistribution), but commands
to take or cease action (interference) to compensate "injured parties", or
forced reorganization to hinder the offending activity from recurring.
Nominally the property still exists with its owner(s), although it has become
encumbered or splintered into multiple properties.

The ability for a government to own and acquire real estate puts it at odds
with (perhaps) its chief purpose, defense of the property of the citizens,
especially when it gives itself the coercive power to grab when all else
fails.

Suspension of rights in times of war is why we are warned about the rise of
the total state under conditions of total war. The "war on terror" is the
current excuse for the non-defense of many rights, not just property.

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notJim
Can anyone explain this? If you tell me a candy bar costs $2 (e.g., that's the
posted price), and then at the register, you actually charge me $10 and I
don't say anything, can I sue you later? I realize that's a ridiculously
simplified example, but it seems in principal/by analogy the same.

~~~
maratd
That's far too simplistic. FedEx, UPS, and other couriers charge more for
residential deliveries. This is fine, because it is more difficult to deliver
to a residence.

However, frequently, these couriers charge a base rate and then tack on a
residential "surcharge" at a later time. Most shipments aren't paid for at the
counter. You get a weekly bill. If you ship more than a few packages a week,
it's very difficult to tell which surcharge is attached to which shipment. All
they give you is a tracking number and unless you spend all day memorizing
their tracking numbers, you won't know which end is up.

Also, are you going to spend 15 minutes on the phone every time you get dinged
for two bucks unfairly? No thanks.

At this point, it's not so much ripping off ... everybody knows it's
happening. Just a hidden cost of shipping.

~~~
isleyaardvark
To go with the candy bar analogy, it's as if you paid $2 with your credit
card, then were charged another $10 a week later. Close?

~~~
pfortuny
No, you go to the candy shop say thirteen times a week, buy some candy (do not
remember the exact number although you have the statements but they do not
specify numbers but weight) and after a week you receive a true invoice with
just the transaction IDs and a grand total.

 _If_ you check this and you notice a $0.50 surcharge... Are you going to
spend 10min to fix it, if it is fixed ("please call later when our accountant
is in")?

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jrockway
This doesn't seem that damning to me. It probably costs FedEx the same
regardless of whether or not the address is business or residential these
days, and it's not like there's some law that requires FedEx to charge a
certain rate. The lawsuit could easily be worded "FedEx systematically
undercharging residential customers for years, sealed e-mail says."

The tone of the article indicates that I'm supposed to be angry about this,
but I'm just not feeling it today. Sorry.

~~~
IanDrake
Same. I read it and though, if they didn't like the price they should have
used UPS or USPS.

~~~
pixl97
I want you for a customer. I'll sign a contract to bill you for $100 an hour.
Then when I send you the bill I'll make sure it's for $125, because hey if you
don't like the price, you should have used someone else.

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DavidBradbury
_"The e-mails were unsealed yesterday in a class-action, or group, lawsuit
claiming FedEx Corp. and FedEx Corporate Services Inc. overcharged commercial
and government customers as much as $3 each for millions of packages
delivered."_

Come on Bloomberg, don't talk to me like I'm five.

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the_economist
Having run an import / distribution operation for over 10 years, I can say a
high degree of confidence that this practice is widespread across the
industry.

The "mistakes" are frequent, and they error on the financial side of the
freight company approximately 95% of the time.

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Coax
When will the lawsuits begin?

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Alaskan005
_“My belief is that we are choosing not to fix this issue because it is worth
so much money to FedEx,”_

They will pay some money to make the lawyers rich, no one goes to jail and
FedEx will repeat it again after a few years. Rinse, repeat. Cost of doing
business.

~~~
notJim
Or maybe, having been called out, they'll pay whatever it costs, and then fix
it once, and it won't happen again? Sorry, but I'm not impressed by mindless
cynicism.

~~~
Alaskan005
Anyway, they were called out before being sued but did nothing about it.

I am cynic because many big corps still have this attitude. See
<http://www.bbc.co.uk/news/business-18866018> and
[http://www.latimes.com/business/money/la-fi-mo-hsbc-
confirms...](http://www.latimes.com/business/money/la-fi-mo-hsbc-
confirms-192-billion-settlement-in-moneylaundering-
probe-20121211,0,487098.story)

