Friday, January 11, 2013

GameFly Wins Ruling Against Postal Service

Los Angeles-based games-by-mail service Gamefly scored a victory today in a dispute with the U.S. Postal Service, after a U.S. appeals court ruled that the the Post Office unfairly gave Netflix and Blockbuster special services in sorting DVDs. GameFly had filed suit in 2009 saying that the preferential treatment by the USPS to Netflix and Blockbuster was unfair to the company, resulting in high breakage rates and other issues. That meant that GameFly was forced to use more expensive, flat cardboard packaging to send its rental games to customers, instead of the cheaper First Class rate that both Netflix and Blockbuster were able to use. The Post Office apparently was providing hand-sorting of DVDs for Netflix.