By Greg Schneider
Washington Post Staff Writer
Saturday, January 13, 2001 ; Page E08

The Justice Department is conducting an antitrust review of the $6.3 billion alliance announced this week between the U.S. Postal Service and Federal Express for air mail delivery, a Justice Department spokeswoman said yesterday.

The deal to pay FedEx to carry express, priority and first-class mail has drawn fire from rival companies, and yesterday the International Brotherhood of Teamsters opposed it. "This new alliance is anti-competitive and bad for American consumers," Teamsters President James P. Hoffa said in a news release. The Teamsters represent 200,000 workers at United Parcel Service Inc.

The Justice Department had been monitoring the talks between FedEx and the postal service before Wednesday's announcement. In a Dec. 11 letter responding to a request from Rep. Henry J. Hyde (R-Ill.), Assistant U.S. Attorney General Robert Raben noted that the postal service competes with FedEx and other companies such as UPS "in the delivery of priority mail and the shipment of packages."

Raben wrote that "the Antitrust Division intends to review any alliance these two parties may reach to determine whether there are issues for federal antitrust enforcement."

Deputy Postmaster General John Nolan said on Wednesday that Justice officials had been briefed on the deal. "If they had said it was the dumbest thing they ever heard," he said, the parties might have backed down. "But we have not gotten any such information from them."