— From staff reports
Though the United Parcel Service claims no wrongdoing, the company will pay out about $12 million as part of a multi-defendant class action lawsuit first filed by an auto parts business in Ardmore.
UPS reportedly began sending out notices to businesses and individuals last week informing them that settlement checks would be sent.
Barber Auto Sales filed the suit in November 2006 in the U.S. District Court of North Alabama, alleging it had overpaid UPS more than $4,600 in shipping charges. The suit accused UPS of fraud, breach of contract and enriching itself.
The initial settlement resolution, which was reached in August, also specified that UPS was to pay $4 million in counsel fees and $10,000 to Barber Auto Sales. UPS also agreed to set up a settlement fund of $2 million and a $10 million fund for account credits or future refunds.
Calls left with Barber Auto Sales and its attorney regarding the settlement were not returned before press time.
The settlement enables anyone who shipped a package between May 15, 2006, and Aug. 29, 2011, to receive a reimbursement if they had to pay additional charges.
As is standard with most shipping companies, businesses are required to weigh packages and pay a fee on the shipped item. Barber’s suit alleged that after entering the information on UPS’s website, additional fees were tacked on after the transaction was completed.
UPS agreed to give back a portion of the overcharges to Barber, but an audit of UPS revealed that hundreds of thousands of businesses and customers experienced the same overcharges. The lawsuit states that UPS manipulated audit procedures so it could “improperly invoice plaintiff-increased shipping charges” based on false dimensions.
A final approval hearing is scheduled for 11 a.m. Dec. 5 at the U.S. District Courthouse in Birmingham. For more information on the class action lawsuit, visit http://barberclassaction.com.