FedEx will plead not guilty to shipping illegal online drugs

By Clarissa Hawes, Land Line staff writer | 7/21/2014

One of the nation’s largest shipping and logistics companies, FedEx Corp., has been indicted by a federal grand jury on 15 charges related to an ongoing criminal probe. Federal investigators claim FedEx trafficked controlled drugs, as well as misbranded prescription medications through illegal online pharmacies. FedEx says it will plead not guilty.

According to the indictment filed in federal court in San Francisco on July 17, it alleges the company had been warned since 2004 about illegal online pharmacies shipping products via FedEx by federal agencies, including the Drug Enforcement Administration, the U.S. Food and Drug Administration, as well as members of Congress.

The indictment alleges that FedEx shipped controlled substances to customers who did not have a valid prescription from their doctors, ordering Schedule III and Schedule IV drugs through illegal online pharmacies, including Superior Drugs and the Chhabra-Smoley Organization.

The indictment states that as early as 2004, FedEx couriers and customer service agents in Kentucky, Tennessee and Virginia “expressed safety concerns to their management, including the following: FedEx trucks had been stopped on the road by Internet pharmacy customers demanding packages of pills; delivery addresses included parking lots, schools, and vacant homes where people would wait for deliveries of drugs,” the indictment states.

FedEx employees also raised concerns to management “that some recipients of the Internet pharmacy packages were engaged in ‘doctor shopping,’ were known to be ‘selling and using,’ and that ‘some of the recipients have overdosed and died.”

The indictment alleges that FedEx Corp., FedEx Express Inc., and FedEx Corporate Services Inc. and their “co-conspirators” profited at least $820 million since 2004 from allegedly shipping the controlled substances or mislabeled medications for illegal online pharmacies.

After the indictment was announced, Patrick Fitzgerald, senior vice president of marketing and communications for FedEx, issued the following statement about the charges against the company brought by the Department of Justice.

“We will plead not guilty,” Fitzgerald said in the statement. “We will defend against this attack on the integrity and good name of FedEx and its employees.”

In his statement, Fitzgerald claims that FedEx transports more than 10 million packages a day.

“We want to be clear what’s at stake here. The government is suggesting that FedEx assume criminal responsibility for the legality of the contents of the millions of packages that we pick up and deliver every day,” Fitzgerald said. “We are a transportation company – we are not law enforcement. We have no interest in violating the privacy of our customers. We continue to stand ready and willing to support and assist law enforcement. We cannot, however, do the job of law enforcement ourselves.”

In March 2013, The United Parcel Service agreed to pay $40 million to end a federal investigation into its delivery practices to customers who ordered controlled substances through illegal online pharmacies.

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