USPS - small claims vs. federal

[factor]

California

This is great forum, and although this issue has been brought up in the past, I thought I'd start a new thread with a caveat.

I own an online e-commerce website, and the day before Thanksgiving of last year, our packages were stolen from a Ryder truck.

Here are the simple facts:
USPS rented a Ryder truck and it was broken into and all contents were stolen.
We lost 150 packages, mostly 1st class, so the majority didn't have insurance (more on that in a minute)
We had to pay overtime for employees to come in Saturday to resend the packages
Lost customers because of late shipments (living in a 2 day Amazon world)
Lost about 8k of merchadise

Although it probably doesn't matter, USPS won't provide the police report. I'm asking for the report, and also want to know if they insured the rented Ryder truck. My thought is the insurance should extend to us. Was the locking mechanism on the Ryder truck adequate? Reaching here, obviously.

I only asked USPS for the lost cost of goods - 8K. Denied based on it being an indemnity claim (insurance wasn't purchased)

USPS will only reimburse for the postage. Small claims is 5k and under and I'm wondering if I have a case. Not interested in taking this to the federal level, and that's most likely where it would end up anyway. Looking for a small claims loophole based on the rented truck.

 

[Zigner]

No - you have no case against the USPS.

 

[justalayman]

For Usps to be liable you have to prove they must indemnify you which would be contract based (insurance is a contract based indemnification) or they were negligent and their negligent acts caused the loss of your property.

So, which do you believe exists in your situation b

 

[FlyingRon]

And legally, you can't sue the USPS in other than federal court. And to even get to federal court you need to pursue the administrative claim process first.

 

[Taxing Matters]

USPS will only reimburse for the postage. Small claims is 5k and under and I'm wondering if I have a case. Not interested in taking this to the federal level, and that's most likely where it would end up anyway. Looking for a small claims loophole based on the rented truck.

First, you cannot ever sue the federal government or any of its agencies, including the USPS, in a state court. You have to bring your claims against the federal government in the appropriate federal court. Your claim here would be a tort claim alleging negligence on the part of the USPS. Tort claims are brought against the federal government in U.S. District Court. That is not cheap or easy to do. There are a number of specific requirements you must follow to sue the federal government. So small claims court certainly would not be an option for you.

Second, the federal government may only be sued for money damages if Congress has consented to the federal government being sued for that kind claim. That consent is known as a waiver of sovereign immunity. For tort claims, that waiver of sovereign immunity is found in the Federal Tort Claims Act (FTCA). The FTCA allows you to sue the federal government for most tort claims that you could sue a private person for in your state’s courts, with a few exceptions. Unfortunately for you, one of those exceptions excludes from the FTCA “Any claim arising out of the loss, miscarriage, or negligent transmission of letters or postal matter.” 28 U.S.C. § 2680(b). Simply put, you cannot sue the government in tort for lost or damaged mail even if the USPS was negligent because the Congress has not waived sovereign immunity for those claims.

For this reason, if the stuff you are sending has value and you want to protect yourself against the loss, you need to buy the insurance. Note that the situation is, as a practical matter, much the same for private delivery services, since in their contracts they routinely include a waiver of liability for loss beyond refunding the price you paid for the service unless you bought insurance to cover it.