Last summer, Valassis found itself the subject of a court petition over an increased discount – up to 34% – the USPS granted it in exchange for the larger volume of mail the direct-mail company promised to produce. Last month, the U.S. Court of Appeals denied that petition, which had been filed by the Newspaper Association of America.
The legal filing arose from NAA’s fear that the “negotiated service agreement” (NSA) that Valassis (distributor of commercial enticements such as the RedPlum inserts) arranged in 2012 allowed that company to go after advertising revenue from the sellers of durable goods such as The Home Depot – some of the only advertisers that newspapers have left since Craigslist destroyed the once-lucrative classifieds market. Needless to say, the association was not happy with the recent decision.
“We’re very disappointed that the court has given its usual deference to federal agency experts,” says Paul Boyle, NAA’s SVP of public policy. “Its decision said that the [Postal Regulatory Commission] did not analyze the NSA’s impact on competition, but that the law is ambiguous on whether they need to do this. We’d be curious to see where [NSAs] have produced tangible benefits for the Postal Service.”
Note: PaperSpecs editor Aaron Berman is a former employee of the Newspaper Association of America. He assures us the only thing he recalls of his time there meeting his wife, being sent to Leipzig to cover a tradeshow once, and another time losing his wallet in a cab in Dallas when he was covering something else.