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then petitioners argue that DHLI would be entitled to an setoff
for its greater cost factor. The proposed setoffs would more
than obviate the adjustments respondent advances in this
litigation. Accordingly, we next consider petitioners’ expert’s
report on this subject.
Petitioners’ expert begins by an analysis of the arrangement
between DHL and DHLI for imbalance and transfer shipments. He
concludes that their arrangement (cost-plus as opposed to a
fixed-fee or flat-rate) is in accord with the postal system model
and “is consistent with arm’s length practice in the context of
the overall, complex contractual relationship between DHLI and
* * * [DHL].” He then states, without explanation, that if the
Court determines that DHLI and DHL are commonly controlled, then
they should each receive from the other the costs incurred for
delivering all documents and/or packages for the other, plus a
normal return on those costs. That, however, is not the
agreement between the parties or the approach used in the postal
system model. The agreement of DHL and DHLI was to compensate
only the party who delivered the excess number of shipments at a
weighted average delivery cost of the person performing the
service. The weighted portion of the agreed formula is dependent
on the types of items delivered; i.e., documents or
packages/parcels. A higher cost is usually attributed to the
packages/parcels.
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