Regents Of Univ. Of Cal. v. Public Empl. Rel. Bd.

ORAL ARGUMENT OF JAMES N. ODLE, ESQUIRE ON BEHALF OF APPELLANT Chief Justice William H. Rehnquist We will hear argument next in Number 86-935, Regents of the University of California v. Public Employment Relations Board, Et Al. Mr. Odle, you may proceed whenever you are ready. Mr. Odle Mr. Chief Justice, and may it please the Court: Most people that I know would not buy a stamp if they could get their letters delivered without one. This case is about whether a labor Union can get its letter delivered across postal routes without a stamp. The United States Postal Service does not think so. Neither does the University of California. But the PERB, that is the California Public Employment Relations Board, and the California Court of Appeal, have found that California law requires the University to deliver that letter. The Federal body of law known as the Private Express Statutes generally prohibits delivery of mail in competition with the Postal Service. PERB argues that two exceptions apply here. These are the letters of the carrier exception and the private hands without compensation exception. This is a technical case, in that it turns on careful reading of those exceptions. But while it is a technical case, it is an important one, because there are millions of dollars of Postal Service revenue at stake here. Unidentified Justice Isn't it going to cost the University some money either way? Mr. Odle It will cost the University perhaps some money in that there may be more letters sent. Unidentified Justice But it will cost the Postal Service, is that it? Mr. Odle It will cost the Postal Service a lot of money. Unidentified Justice Thanks. Of course, it will also save them a lot of work, too, won't it? Mr. Odle It will not save them very much, actually. Unidentified Justice It will save all the work involved in delivering this mail from where it is given to your client to deliver to the Union people, won't it? And if they are losing money on delivery now so that they need postal rate increases, they will actually be better off. Mr. Odle Justice Scalia, I don't think they are losing money on this kind of delivery. There is a single postal rate whether you send a letter from Maine to California or across Berkeley. And this is mail sent, the letters in this case would have been sent from a location in the City of Berkeley to the University in Berkeley, and it probably would not have 22 cents a letter to deliver those. Unidentified Justice I thought they were delivered throughout the University system? Are all the deliveries in Berkeley? Mr. Odle The case arose over deliveries in Berkeley, but I think that you are right, Justice Stevens, that at stake here is a larger mail system. Unidentified Justice It is a big State and there are a lot of branches of the University. Mr. Odle That is right. Unidentified Justice Will how we decide this case help me to get my mail faster? Mr. Odle Yes, it will, Justice Marshall. Unidentified Justice Do you really think so? Mr. Odle I do. Or at least, I take that back, it may, what it may do is make your mail slower. I doubt that it will make it faster. The amici, in this case, by their own account, represent some 3,500,000 employees, to whom they are eager to deliver unstamped letters. Unidentified Justice 3,500,000 employees of what? Mr. Odle These are employees of employers across the country. Unidentified Justice Oh, I see. I see. Mr. Odle The Union represents those employees. Unidentified Justice Employers who would be in the position of the University? Mr. Odle I believe so. Unidentified Justice Yes. Mr. Odle It has to be recognized that if the Postal Service loses the revenue from those letters, other patrons of the Postal Service are going to have to pay for it, either in lower quality of service or in higher rates. And, Justice Marshall, I would suggest that you would pay for it in lower quality of service. Let me talk about the two exceptions. The letters of the carrier exception is the exception that allows the University to deliver its own letters without a stamp. The language of that exception and the legislative history of it I think have been very thoroughly briefed. We think it is clear that the exception applies to letters sent by or addressed to the carrier... in this case, the University. Unidentified Justice You think it is clear from the language? Mr. Odle I think it is very clear from the language of the regulation, Justice Scalia. Unidentified Justice Let's talk about the regulation. You urge that we must give deference to the regulation. We give deference to the regulations of agencies that are charged with the administration of particular schemes. But it seems to me that the Post Office is not charged with administration of this law prohibiting persons other than the Post Office from carrying mail. That is like saying that the Attorney General is charged with administration of the criminal laws so we should defer to the prosecutor's determination of what a criminal law means. You are not administering this statute at all. It would be very strange to say you are administering it. To the contrary, you are the chief competitor of those who are trying to avoid the statute. Why should we give you deference? Mr. Odle It is certainly true that the Postal Service is the chief competitor of those who would deliver it in competition with the Postal Service. The Postal Service, however, it seems to me, does administer the statute, in fact. It is authorized by Congress, for example, to suspend the operation of the statute in what the Postal Service considers to be appropriate cases. And it writes suspensions of the statute which specifically enable others to deliver letters which the Postal Service would otherwise deliver itself. Unidentified Justice What provision is that that enables them to do that? Mr. Odle I can point you to the Code of Federal Regulations sections in which the suspensions are written. The legislation is in Section 601. The Postal Service may suspend the operation of any part of this section upon any mail route where the public interest requires the suspension. That is Section 601, 39 U.S.C.-- Unidentified Justice Thank you. Mr. Odle --The letters of the carrier regulation provides that the sending or carrying of letters is permissible if they are sent by or addressed to the person carrying them. Now, the regulations recognize that "person" for this purpose may be an institution. And the regulations also recognize that when a letter is sent by or addressed to an institution it is going to have to be carried by some individual. So the regulation provides, and I am reading here: "If the individual actually carrying the letters is not the person sending the letters or to whom the letters are addressed, then such individual must be an officer or employee of such person. " In other words, the individual who actually carries the letter must be an officer or employe of the institution sending them or to whom they are addressed. Now, the person carrying these letters is an employe of the University. When a third party, like a Union, sends a letter, the sender is the third party. So the issue is, is the University the receiver of that letter? And the answer is, it depends. If the letter is sent to someone who receives it as an agent for the University, who receives it on behalf of the University, it makes sense to call that a letter to the University. If the person who receives that letter doesn't receive it as an agent of the University, but receives it on his own behalf, it is not a letter to the University. For example, if, as the University's lawyer, if I receive a letter from the Union about this case, I receive that letter on behalf of the University and it is a letter to the University. If I receive a letter from a Union saying Mr. Odle, we think you ought to join the Union and authorize it to bargain on your behalf with the University and try to get you a higher wage and maybe strike against the University if you don't get it, that is not a letter to the University. That is a letter to me. Unidentified Justice Mr. Odle, I thought that the State legislature in California has determined that providing Unions access to the internal mail of the mail system is the current business of the University, or has made some effort legislatively to say that it is defining the business of the university as including this. Now, what do we do with that? Mr. Odle Well, you realize first that the regulation states a two-part test. The letter must relate to the current business of the University and it must be to or from the University. Unidentified Justice Well, of course, the statute itself, Section 1694, refers to, as the exception, except such as relates to the current business of the carrier. Mr. Odle That is right. And I believe that the intent in enacting that statute in 1909, as we have argued in the brief, was to codify an Opinion of the Attorney General dated 1896. Unidentified Justice Is that your interpretation of the regulation and the validity of it? You would not fall within the letters of the carrier exception? You depend on the regulation totally, I gather. Mr. Odle I think we would if we read the statute properly. I think that we would fall, that these letters would fall outside of the intent of the statute, if that is your question. I think that because the Attorney General's Opinion which preceded the statute is very clear and I think the legislative history is very clear that what Congress meant was to embody that opinion in the statute. And there is another Attorney General's Opinion a year later, in 1910, which says that that is what Congress meant and that is what it did. And that law has been on the books in that form ever since. Unidentified Justice It would have been so easy to say that, though. It would have been so easy to say except letters addressed to or from a business and relating to its business. It is not as though it is difficult to describe what you say they meant. They just didn't put it that way. They just said it has to relate to the business. Mr. Odle That is true, Justice Scalia. And I don't know why they did not put it that way. I do know that Congress was told by other Congressmen, by Congressmen who were instrumental in promoting the 1909 legislation, that it would in fact embody the Attorney General's Opinion. But as to why they felt it was not necessary to go into that detail, I don't know. I think they felt that they read this phrase, relates to the current business, in a somewhat narrower way than it could be read. Why that is, I am not sure. As further evidence that the letter is not a letter to the University, if more evidence of that is needed, it seems pretty clear that it would violate California labor law for the University to read that letter, just as it would violate Federal law for an employer covered by the National Labor Relations Act, to read such a letter from a Union to the employee. PERB argues that if the letters of the carrier exception doesn't apply, the private hands without compensation exception does. The problem with that is that the University is compensated. We receive money from the California Legislature which pays for the operation of the mail system. And the California Legislature is also the entity that has ordered us to deliver the mail. It just offends common sense to say that mail which is ordered and paid for by the same entity is not compensated. PERB argues that the intent is the key here, that if the intent is to compete, the exception does not apply but if there is another intent, it may apply. The problem is that the California intent here, the Legislature's intent, is clearly to withhold revenue from the Postal Service. The purpose is to facilitate communication, but to facilitate it in just one way... by making it cheaper. It is sophistry to say that the Legislature intends to save significant dollars for the Unions but doesn't intend to withhold significant dollars from the Postal Service when they are the very same dollars. Anyone setting up to compete with the Postal Service on more economical routes like these could claim to be facilitating communication by making it cheaper. The problem is that there has been a national decision, there should be a national postal rate, there should be a Postal Service to accomplish that. And to preserve that service, it is necessary to say you cannot compete with it unless you fall under one of the exceptions. Those exceptions are to be made by Congress, not by the California Legislature. Unidentified Justice Counsel, it is still not clear to me how many people use this system. Mr. Odle The University of California has about 100,000 employees. We use the system to deliver our own mail. That is, mail sent to or from the University of California employees. Unidentified Justice What if a professor wants to send a letter to another professor down the hall? Mr. Odle If it is down the hall, he probably carries it. He may send it through the University's mail system. It may not be involved with these laws, because it has to cross a Postal Route to be subject to these laws. Unidentified Justice It can be mailed by the same system. Why do you draw the line between the professor and the other people? Mr. Odle Because if the professor's letter is sent to another university employee on the business, that is, as a representative of the University, it is a letter to the University. The problem is that the Union letters are not. Unidentified Justice If a professor is writing to another professor about a third professor at Harvard, that involves the University? Mr. Odle I would say it depends, Justice Marshall, if I may just take a moment to answer. Unidentified Justice Because if you take Harvard, I'm going to go to Oxford. Mr. Odle Let us suppose that the professor at Harvard has applied for a job, and one professor writes to another and says he is good, I think you ought to hire him. That would be a letter to the University. On the other hand-- Unidentified Justice What if he asks him how about his Union business? What does he think of his Union? Mr. Odle --I don't think that would be a letter to the University and I don't think it could be carried by the University. Unidentified Justice This is to another professor? Mr. Odle That's right. Unidentified Justice I am writing to you to find out how is Joe Droke's standing with the Union. Mr. Odle Unless you wanted to know that in order to conduct University business, your letter would not be a letter of the University. You could write to that other professor asking him if he wants to join you for Halloween, and that would not be a letter of the University. Unidentified Justice Isn't it? Isn't that University business? Mr. Odle I think the answer to that is more complicated than yes or no. Certainly, collective bargaining is the University's business in the sense that we engage in it, we hire people to do it, and if there is a letter from our collective bargainer, to the President of the University, about Union negotiations, that is certainly a letter of the University. But the issue here is, if there is a letter from the Union encouraging an employee to join the Union, is that a letter to the University? And we think it is not. Chief Justice William H. Rehnquist Thank you, Mr. Odle. We will hear now from you, Mr. Wright.

ORAL ARGUMENT OF CHRISTOPHER J. WRIGHT, ESQUIRE AS AMICUS CURIAE IN SUPPORT OF APPELLANT Mr. Wright Mr. Chief Justice, and may it please the Court: Broad constructions of the private express statutes like the decision of the Court of Appeal below do reduce the scope of the Postal monopoly and threaten to reduce Postal revenues. As Mr. Odle said, the fact that three and a half million employees are represented by the amici in this case shows that a substantial amount of mail could be diverted from the Postal Service. Unidentified Justice Mr. Wright, what authority does the Postal Service have to issue this regulation? Mr. Wright Section 401, 39 U.S.C. 401, which is quoted in a footnote on Page 23 of our brief. Unidentified Justice So you think that authority to issue that regulation entitles the Postal Service interpretation of the statute to some deference? Mr. Wright I certainly do. The statute says that the Postal Service has authority to adopt, amend, and repeal such rules and regulations as it deems necessary to accomplish the objectives of this title, which include the private express statutes. Congress has quite clearly given the Postal Service authority to define what these statutes mean. It is true that the Postal Service is also the beneficiary of this statute. I take that to mean that Congress would not expect the most liberal interpretation of the statute. It would expect the contrary. Unidentified Justice How long has the Postal Service interpreted this Act that way? Forever? Mr. Wright Yes. In turning to the letters of the carrier exception, this is a classic case of deference. This is a long standing interpretation that was originally formulated contemporaneously with the relevant statutory amendment which was in 1909, and it has been consistently followed ever since. I would like to go through that briefly, the legislative history. First, let me note, the words of the statute are ambiguous. It could be construed the way the Postal Service has done it. It could be construed the way the Court of Appeals has done it. I would say that the issue here is whether letters to institutions can only be sent to their representatives. That is the way the Postal Service has construed it, and the issue is whether they have properly done so. I would think that the language of the statute letters relating to the current business of the carrier would normally be sent to representatives, would not be sent to someone else in the case of an institution. It is true that you can define the business of something like a university very broadly and include almost everything, including the letters here. So I start with the proposition that the language is ambiguous. But this is a case where the legislative history is very, very clear. In the 1896 Attorney General Opinion letter that was referred to, the Attorney General concluded, despite the lack of a basis in the language of the private express statutes at that time, that a railroad could carry its own letters. He said that the right he identified was quote: "to carry letters written and sent by the officers and agents of the railroad company which carries and delivers them, about its business, and these only. " Unquote. He added that: "companies could not carry letters that are neither written by that company nor addressed to it. " Unquote. IN 1909, when Congress added the language at issue here, the principal proponent of the amendment was Senator Bacon. And he wanted to revise the statute to express in exact language what the Attorney General says it means. The Senator who actually proposed the language of the amendment was Senator Sutherland, and he said that that was its purpose. And the Conference Report, which was printed in the Congressional Record at that time said that it put the statute quote: "in exact conformity with the construction placed upon existing law. " Unquote. And then referred to Attorney General Harmon's 1896 Opinion letter. Legislative history is rarely this clear. But there can be no question that Congress intended to codify the 1986 Opinion which stated that railroads could carry letters sent to or by its officers and agents but not letters that are neither written by nor sent to the company. Unidentified Justice Mr. Wright, educate me, because I speak from ignorance. In the last decade or so, we have seen a proliferation of Federal Express and Emory and all these other overnight carriers. Do they operate under some special statute? Mr. Wright Yes. The Postal Service is also authorized to suspend the operation of the statutes where the public interest so requires. In 1979, it did so for extremely urgent letters which are defined in the regulations basically to be letters that cost a certain multiple of normal postage. It is a regulatory suspension under which Federal Express operates. Unidentified Justice It seems to me that this is devastating competition to the Postal Service. Mr. Wright The legislative history of the 1979 amendment... we cited the hearings in our brief... the Postal Service adopted that suspension somewhat reluctantly. I think it is fair to say that Congress would have enacted it statutorily if the Postal Service had not come up with a regulation. But it did and that solved the problem. PERB suggests that its interpretation of the private express statute warrants deference. We think that that is plainly wrong. Its interpretation of the California statute that says that Unions can use... the California statute says that Unions can use... the means of communication of employers. PERB has construed that to mean internal mail systems. We have not quarreled with that. That is entitled to deference. But Congress gave the Postal Service, in Section 401, the authority to construe the private express statutes. It didn't give that authority to PERB. I would like to turn to the other exception that PERB says authorizes the deliver here, the private hands without compensation exception. This is another long standing exception. The precise language dates back to 1845, the private hands without compensation. In 1846, a District Court stated that a deliverer of merchandise could not also deliver letters even though it did not make any separate charge for the delivery. And the Postal Service has followed that interpretation ever since. More recently, in the 1970s, a number of cases came up involving school districts who wanted to deliver Union letters, very similar cases to this one. In some of these cases, collective bargaining agreements spelled out a duty to carry the Union's letters. IN those cases, I think it is clear beyond doubt, and I do not understand PERB to disagree, that compensation was involved. As the prior case demonstrates, employers and Unions are in an adversarial relationship. Unidentified Justice Mr. Wright, what is the compensation in this case? Mr. Wright There are three different kinds of compensation here. First, this is all part of a bargain under which the employees give their labor to the University. Unidentified Justice But it is a statutory requirement, isn't it, that they do this? Mr. Wright If there was a statutory requirement that the University's dental school give free service to Union employees, or just employees of the University, I do not think there would be any question that that would arise out of the employment relationship, and the compensation to the University of the employees' labor was compensation whether or not it was statutory or contractual. Unidentified Justice Tell me again, what is the compensation to the University for doing this? Mr. Wright Three things. Our first argument is that it is the labor of the employees, and their agent, the employees' agent, the Union, gets to send these letters. Unidentified Justice It is like a fringe benefit for the employees? Mr. Wright Exactly. Unidentified Justice You don't have any cases that are remotely like? I mean, I can understand the theory of what you are saying, but that is quite different from any of your precedents. Mr. Wright This is a unique case, because the State has ordered the carrying. Unidentified Justice Yes. Mr. Wright Second, the fact is that the State is the employer here, and it is just like the school district cases, in our view, except that the Unions go and negotiate with the legislature rather than directly with the University. They've gone up a step. We think that that is clear, if you look at the next case. Unidentified Justice I still don't understand. What I am asking is, what is the compensation? One thing you say, the compensation is the services of the employees who receive the mail. Mr. Wright Right. Unidentified Justice That's the compensation. Now, you said there are two other things that might be compensation. Mr. Wright Our next answer is that this is just like the school district cases. If the Union had bargained a contract provision, if you will grant me that there is clearly compensation there, if an employer agrees to deliver an Union's mail-- Unidentified Justice In exchange for what? What is the compensation? Mr. Wright --Presumably it is agreeing to some other demand in the collective bargaining agreement. It is usually implicit. It is not spelled out. In this case, they've got that through the legislature. In the next case, if we should lose this case, the Unions will go to State legislatures and say, you can give us a big benefit. We will save a lot of money if we can use internal mail systems, and this will cost you very little. Please pass a law. Unidentified Justice You are saying that this exception would not apply if I asked a friend to deliver a mail to someone, he is going to Chicago on an airplane and I say would you take a letter along and he says yes, I'll do it for you if you'll do the same thing for me a week from now on the return trip, then they have to pay postage? Mr. Wright We would say there is compensation here. As it happens, the special messenger exception to the private express statutes would cover that, in any other case where he was handling fewer than 25 letters. But the private hands without compensation exception would not apply there. There would be compensation. Unidentified Justice Now, what is your third compensation? Mr. Wright The third case is, PERB says we're wrong. It says you are wrong to say the State is the employer. The State and the University are different. But if that is true, then it is even more clear that it is compensation, that there is compensation here, because the University is both ordering them to carry mail and paying for it, because it funds the University. Unidentified Justice I take it there is always some expense to the private carrier making the delivery. The fact that he has to pay his own bills cannot make it. Mr. Wright But it is different if the person ordering it also pays for it. If I ask you to deliver a letter and give you money to do it, even if it is a letter from someone else and being received by someone else, even if it is not my letter, if I am both telling you to pay for it and paying you to do so, I am compensating you for that. Unidentified Justice Mr. Wright, may I inquire whether you think we owe the same degree of deference to an agency's interpretation or construction of a statute by regulation if the effect of it is to pre-empt State law? Mr. Wright Yes, we think so. I would like to make one other point. PERB has also argued that the Postal Service has not been consistent in its application of these statutes, relying on an Indianapolis cased where the Postal Service said that a school district could carry letters from a community service group to students about Food Stamp programs. We think it quite clear that there is no form of compensation there. None of the three forms of compensation that I mentioned briefly a moment ago or in more detail in our brief would apply. Chief Justice William H. Rehnquist Thank you, Mr. Wright. We will hear now from you, Ms. Biren.

ORAL ARGUMENT OF ANDREA L. BIREN, ESQUIRE ON BEHALF OF APPELLEES Mr. Biren Mr. Chief Justice, may it please the Court: The question here is whether California's strong State interest in efficient communication and effective communication between employees and their representatives as codified in HEERA can be harmonized with the private express statutes. The State has determined that the University of California has a statutory duty to allow employee organizations to carry this mail to employees in order to make the HEERA scheme of cooperative labor relations effective. The private express statutes, we submit, can be harmonized with the State law by using either one of the two exceptions that have been discussed this afternoon, the business of the carrier exception or the private hands without compensation exception. Postage foregone under one of these exceptions is postage forgone pursuant to Congressional design. Unidentified Justice Ms. Biren, let me ask you. Supposing if the 3,500,000 were filing an amicus brief here all succeed in getting what you say the University of California employees get, do you think that would be pursuant to Congressional design? Mr. Biren First of all, I think it is not the least bit clear that all 3,500,000 of them would be covered under a decision in our favor in this case. We have relied substantially on a specific statute here, HEERA, which really sets up a very cooperative labor relations scheme in which the employees are supposed to be allowed the fullest participation possible through their employee organizations in the determinations of conditions of employment, and there is an access statute which specifically says that these employees can hear from their employee organizations through the mail system. That is not the case in many states represented by amici. Unidentified Justice What difference does that make in interpreting the provisions here? Mr. Biren If you were particularly bothered by the fact that-- Unidentified Justice Let's assume you accept the regulation. Do you think that this means that these State law provisions take these deliveries out of the regulation? Mr. Biren --I think that these deliveries are within both the statute and the regulation. Unidentified Justice Because the employees, the recipients, are agents of the University? Mr. Biren For several reasons. First, I think-- Unidentified Justice But in terms of the regulation. Mr. Biren --In terms of the regulation, that is what I am going to talk about. As I said, here is a cooperative labor relations scheme in which the employees are part of the decision making on something that is patently the business of the carrier... the terms and conditions of employment of the employees. Through their representatives, they participate in bargaining over this. Therefore, as to this particular business of the University... labor relations, the determination of terms and conditions of employment... these employees are equal partners in that decision making, and their representatives, therefore, are their agents. They are their agents. And I think it is stretching it, but I think in a broader view, if you insisted upon the agency concept, which I do not think is present in either the statute or the regulation, you could say that they are the agents of the University as a whole in fulfilling its total duty under HEERA to allow employees to participate to the fullest extent in the labor relations scheme. I have made one of the points I wanted to make, regarding carriage, at issue here, being within the statute and the regulation, because of the carrier's business. The other point that I would go into at more length is under the private hands without compensation exception, to show that the University is not private hands, because it is not the Postal Service, and there is no compensation for carriage because compensation has traditionally been interpreted as money, identifiable goods or services, and lately, since 1976, good will, flowing between the user and the carrier. State funding does not meet that description. State funding is not compensation, within the intent of Congress when it passed the private hands without compensation exception. Unidentified Justice When you say State funding, I mean, did the California legislature appropriate money to the University of California to perform these services? Mr. Biren The State of California appropriates money to fund the mail system. It did before HEERA existed. It did before this order existed and there is no showing in the record that there is any relationship between the order to carry this mail and the type of funding they received for the mail system. Unidentified Justice So far as you can see, the University will get the same line item, if it is a line item, for carrying mail, even after this as before? Mr. Biren To the extent that the record deals with this matter, that seems to be the case. There is no showing that made any difference. Unidentified Justice The line item meaning what? 100 percent? Mr. Biren Right. Unidentified Justice 100 percent of whatever mail they carry gets paid for by the State. Mr. Biren That's right. Unidentified Justice The State has told them to carry the mail and the State is going to pay for 100 percent of the carriage. Bingo. It seems to me that is all the regulation requires, isn't it? Isn't that compensation? How could it be not private carriage? The State is directing the carriage by the University and is paying the University for doing the carriage. Mr. Biren Because I think if you look at the traditional interpretation of the meaning of compensation within this exception, if you start from 1792, in the first statute it talked about for hire or reward. It went through, and there was an identifiable exchange of money, goods or services between the user and the carrier. The State here is no the user. Unidentified Justice Do you have any cases that are even close to this case? Mr. Biren No. Well, the only thing that is close is the Advisory Opinion in 77(a) which allows the Indianapolis School Board to carry the circular. Obviously, in terms of the compensation they receive, the compensation for that mail system is no different than the compensation here. The State funds the mail system for the School Board in Indianapolis. Or I am not sure exactly who funds it. But the Government funds it. Just following that through, staying with the private hands without compensation exception, in 1846, in United States v. Thompson, the paying for merchandise there was, on could see it as pumped up to include the payment for the carriage of letters. This Court, in 1878, in Ex Parte Jackson, talked about the purpose of the Postal monopoly as being to prohibit carriage for hire. In 1896, the Attorney General's Opinion talked about traded services between railroads. And in 1908, in the discussions in Congress about the business of the carrier exception, they talked about their understanding of the Postal monopoly, which was to prevent carriage for profit. Again, the intent of Congress here was to avoid entrepreneurial competition with the Postal Service. Unidentified Justice It would be one thing if the University were here insisting that they had a right to do this under the statute. But the University says no. Mr. Biren The University does say no. But I am afraid I'm missing the import of your question. Unidentified Justice It seems to me you would have a little bit different case here if the University were on the other side of the case and it was the University and the Unions against the Government, in effect. Mr. Biren Are you talking specifically about the private hands exception? Unidentified Justice I'm talking about both. The business of the University and the private hands. Mr. Biren Let me give you an example in return, because I think it shows. When a State law imposes a duty on an employer, it is not always a happy thing. Suppose a developer had to fill out environmental impact statements. They don't necessarily want to do that. But it still their State law duty. It is still part of their business. And I think that is analogous to the situation here. The University may not want to do it, but the State has said, in the interests of society and in the University's interests, and in the interests of the employees, they do need to do this. Unidentified Justice I don't know whether they want to do it or not, but I suppose they want to obey the Federal law, too. Mr. Biren They do, indeed. Unidentified Justice What if the University had been convinced that they could legally carry this and wanted to, but they just happened to be wrong. What does the Postal Service do? Do they sue somebody or what? Mr. Biren It appears to me that what they do is they inform them that they are carrying in error. Unidentified Justice And they have informed the University here, haven't they? Mr. Biren They have. Unidentified Justice So the University has some grounds for saying, let's be careful. Mr. Biren And that's why we're here. Precisely. But our contention is that these two statutory and regulatory exceptions provide for this type of carriage, because in the business of the carrier exception, to do otherwise, we submit, would simply be irrational and as we have said with private hands without compensation it would be inconsistent with the previous interpretation. Now, it may well be that Congress may wish to expand its definition of compensation from these identifiable goods and services, but until it does so-- Unidentified Justice I haven't heard you argue yet that the regulation here is invalid. Do you argue that? Mr. Biren --Which regulation are we talking about? Unidentified Justice The regulation on the letter. Mr. Biren No, I don't argue that it is invalid. Unidentified Justice So it is a legitimate interpretation of the statute? Mr. Biren Correctly interpreted to allow employees to receive mail in the labor relations situation, yes. Unidentified Justice But what if we disagree with you on the interpretation of the regulation? Would you then say it is invalid? Mr. Biren I think that the regulation is certainly an expansion of the plain words of the statute. The plain words of the statute say such as relates to the business of the carrier. We have not directly attached the validity of the regulation and have assumed arguendo it is valid because we believe that this carriage is appropriate under both the statute and the regulation. It is appropriate under the regulation because mail is going to UC. The address says "University of California", to University of California employees. It is from a UC employee representative organization. In this case, it was also from a UC employee on the UC campus. And it is on University business. And we believe that brings it within the letter and the spirit of the regulation, as well as the statute. In the labor relations context, it would really be unreasonable not to interpret it this way, because when you talk about agency in terms of control of the employee response, which the University has done in its brief, that is illegal in the labor relations context. And it is specifically illegal under the HEERA scheme. Rather, in this cooperative scheme, you have a pluralistic university with many parts, and the employee part has a role to play in decision making on terms and conditions of employment. In other words, there is a middle ground between an identity of interest with management and a personal interest. And that middle ground is the interest we find here, which is of employees participating in the labor relations scheme through their employee organizations. Unidentified Justice I just wonder whether you could not, by extending that reasoning, apply it to a business man and his client. I mean, in the same sense that there is a symbiotic relationship between the employer and the Union, there is the same kind of relationship between a businessman and a client of his and you could say that in facilitating the correspondence of let's say a lawyer, facilitating the correspondence of one of his clients with another client who are more or less in the same businesses, he is really engaged in his own business in a say so that if a large law firm got in the business of distributing mail of its clients one to another, by parity of reasoning with what you just told us, they are really parts of a multi-faceted business arrangement. Mr. Biren But there are two distinctions. The first distinction is that in this case the business is State law duty. There is no State law bonding between the client and the attorney in your example. And secondly, in the regulation there is also the necessity that it be to the carrier. And in your, I believe in your hypothetical, it is not necessarily to the carrier. I'm not sure who was carrying in your hypothetical. Unidentified Justice That's right. That's right. It's from one client to another. But yours is to the carrier only in the address sense, that is, it is to somebody whose address is in the University of California. Mr. Biren My argument is twofold in that case, too. It is more than just the address, although I believe the address is important. When you think of the administration of this regulation,-- Unidentified Justice The President of the University of California could not say "give me that letter" and open it up and read it, could he? Mr. Biren --Well, in fact,-- Unidentified Justice It is not addressed to him. Mr. Biren --But under this exception, they do have the right to monitor the mail. And so I am not sure it is at all true that he could not open it up and look at it. The University has claimed that that might subject them to an unfair labor practice charge. But I would submit to you that anyone can file a charge about anything. Whether or not it leads to the issuance of a complaint and whether or not it would be upheld by the Board is a totally different matter. In a situation in which the University is compelled to monitor this mail, I find it highly doubtful that PERB would decide that it would be an unfair labor practice to monitor the mail. So the distinctions I was pointing out were that it was to the carrier in the sense of the labor relations scheme that the employers are part of the components of the entity that make business decisions; and it is to them in terms of their address, as well. I think it is important also to note that there is no agency requirement on the face of the statute or the regulation. It simply doesn't say that. Unidentified Justice I wonder if that is right. Read the second sentence of the regulation: "If the individual actually carrying the letters is not the person sending the letters. " and of course, here, it is not, "or to whom the letters are addressed. " and here it is not, "then such individual must be an officer or employee of such person. " Mr. Biren That is talking about who carries the letters. Unidentified Justice Correct. Mr. Biren What they are saying is you cannot have a subcontractor carrying these letters, it has to be a regular employee of the University. Unidentified Justice No, a regular employee of either the addressee or the sender. Mr. Biren Exactly. Unidentified Justice And he isn't here. The carrier is not an employee of the Union which originates the letter nor is that individual an employee of the addressee of the letter. Mr. Biren Our contention is that in the sense that the employees here represent part of the University that makes its business decisions on labor relations, that that carrier is being employed by the University. And they are part of the University. Unidentified Justice You are assuming that the addressees are the University, then? Mr. Biren Oh, yes. The addressees were at the University. Unidentified Justice You are saying the letters are addressed to the University? Mr. Biren They are addressed to the University. It says here, William Wilson, U.C., Berkeley. So it is addressed to the University. But also, that they participate in this decision making. And as I said, if the agency concept is pushed to its outer limits, I think you could see them as agents of the entire University, in that it is under HEERA, the specific responsibility of the University to foster and environment in which the employees can participate to the fullest in the labor relations scheme. Unidentified Justice Making that argument, what if the State of California, or the Legislature, passed a statute saying it is part of the responsibility of the University to foster good neighborhood relationships and one way to do that will be to add to the business of the University delivery of free mail to everybody within five miles of the campus? Would that be then part of the business of the University? Mr. Biren Certainly it would be a State law duty of the University, and to that extent, it would be the business of the University. The letters, I believe, in your example, would not be from the University or to the University, though. Unidentified Justice They would be people who are neighbors of the University. Mr. Biren But that is not to or from the University. Those are the kind of through letters that are talked about in the Attorney General's Opinion. The letters here were not through letters. They went to the University. Unidentified Justice By reason of the statute, they have been made part of the University, in the common enterprise of fostering community relations, just as the Union, under your theory, has been made part of the University by the labor laws. Whenever laws push people together and require them to deal with one another, you can develop a theory that there are all part of the same agency. That is what I understand your theory to be. Mr. Biren My theory is beyond that, because we are not... without having your entire statutory scheme about the neighborliness before me it is somewhat difficult. But in this situation, they are doing cooperative decision making on what is patently the business of the carrier, which is the terms and conditions of employment under which the carrier's employees work. Unidentified Justice From whom do these letters... who sends them and who receives them? Mr. Biren In this case, a University employee, William wilson, sent the letters to other University employees. Unidentified Justice What was the subject of the letters? Mr. Biren The subject of the letters was an organizing meeting. Unidentified Justice To get people to join the Union? Mr. Biren Exactly. Exactly. And self organization is explicitly one of the rights guaranteed to employees under HEERA and one of the rights which the University is supposed to help create the atmosphere for. Unidentified Justice What if William Wilson sent another kind of letter to another University employee that said let's organize a camping trip next weekend? Is the reason that would not be barred or would be barred by the private carrier exception that it isn't the business of the University? Mr. Biren Well, it is not the private carrier exception, it would be the business of the carrier exception. Unidentified Justice Pardon me. The business of the carrier exception. Mr. Biren Yes. It is not the business of the University. It is a personal letter. Unidentified Justice What if the Legislature then says we think we should encourage all employees of the University to get out in the great California park system and that is a State duty of the University to encourage these people to get out? Now, then, would that change it? Mr. Biren It would be then the State law duty and yes, it would change it, but... yes, it would change it. But here we have a specific police power of the State involved, labor relations, in which there is a strong interest in having-- Unidentified Justice But the California Legislature surely has any number of areas of authority over the State University of California. Its police power is very, very broad, I would think. Mr. Biren --That is right. Its police power is broad. But I think it does have an outer limit, at which point the harmonization required between Federal law and State law-- Unidentified Justice Would you say it was beyond the competence of the California Legislature to pass a statute saying that it is the business of the University of California to encourage its employees to get out in the wilderness over the weekend? Would you say that that is just beyond the competence of the Legislature? Mr. Biren --No, I don't think it is beyond the competence of the Legislature. No. But I am afraid I must be missing the thrust of your question. Unidentified Justice You agree then that with a letter from Mr. Wilson of the circumstances I have described and with the statute, could that be carried by the University mail system without violating the Private Express Act? Mr. Biren It could be carried if it was specifically the State law duty imposed by law and it was going either from the carrier... in other words from-- Unidentified Justice Mr. Wilson. Mr. Biren --Well, it could be going from Mr. Wilson to other agents of the carrier on the business of the carrier. Yes. But I think it is important to realize that labor relations holds a very special place and that it isn't the case that it is likely for California to pass that type of law. I did do a great deal of thinking about those types of laws, in preparing for this argument. And I think it is important to realize that labor relations is a special subject and this decision by the Legislature to foster these labor relations puts this type of carrier in a special place. And further, perhaps another distinction is that in this statutory scheme, there is a special place for access, that the facilitation of effective communication is particularly important because of the problems in labor relations that this Court knows about historically, of employee organizations being able to communicate with their employees. There is a long standing public policy in California to allow in public employment this type of mail system communication between public employees and their organizations. There is a 1965 California Attorney General Opinion on the subject. And in the hypotheticals that you were propounding, I don't think you will see that kind of long standing history. Unidentified Justice Who wants to go camping by themselves? You have to get some other people. Mr. Biren That's right. Well, through the U.S. Mail. If there are no other questions, I think I will take my leave. Thank you very much. Chief Justice William H. Rehnquist Thank you, Ms. Biren. The case is submitted. Unidentified Justice The honorable court is now adjourned until tomorrow at ten o'clock.