FedEx Charged in Illegal Prescription Drug Conspiracy

The Justice Department indicted FedEx Thursday on federal charges that accuse the company of having conspired with illegal online pharmacies to deliver controlled substances and other pharmaceuticals purchased by people without prescriptions.

The 15-count indictment stems from deliveries made from 2000 to 2010 from illegal pharmacies that only required an online form to order prescription medications. According to the indictment, FedEx had knowingly been delivering the drugs even after multiple warnings from drug enforcement officials. The scheme, prosecutors say, netted the company $820 million.

"The advent of Internet pharmacies allowed the cheap and easy distribution of massive amounts of illegal prescription drugs to every corner of the United States, while allowing perpetrators to conceal their identities through the anonymity the Internet provides," U.S. Attorney Melinda Haag said in a statement. "This indictment highlights the importance of holding corporations that knowingly enable illegal activity responsible for their role in aiding criminal behavior."

According to prosecutors, FedEx had made arrangements to keep the flow of drug deliveries moving even after some of its couriers alerted them that they were being threatened with violence. From the San Francisco Chronicle:

The grand jury also said FedEx couriers in Kentucky, Tennessee and Virginia had warned the company as early as 2004 that their trucks were being stopped by pharmacy customers demanding packages of pills and threatening them with harm, and that some of the listed delivery addresses were vacant homes where carloads of people were waiting for their drugs.

In response, the indictment said, FedEx began separating drug deliveries from problematic Internet pharmacies and holding them for pickup at company stations.

FedEx has also been accused of colluding with illegal drug companies and their known associates even after they had been shut down and their proprietors arrested. From NBC News:

But the indictment alleges that the company continued to distribute controlled substances and prescription drugs on behalf of the Chhabra-Smoley Organization and Superior Drugs. They did so even after officials knew they had been closed down by state and federal law enforcement agencies and that their owners, operators, pharmacists, and doctors had been indicted, arrested and convicted of illegally distributing drugs, it said.

Fed-Ex conspired with Chhabra-Smoley between 2000 and 2008 and Superior Drugs from 2002 through 2010, the indictment said. Prosecutors noted that, Drug Enforcement Agency, Food and Drug Administration and Congress had informed FedEx that illegal Internet pharmacies were violating state and federal law by using its shipping services to distribute controlled substances.

FedEx disputed the charges, with Patrick Fitzgerald, senior vice president of marketing and communications, telling the Wall Street Journal, "We will defend against this attack on the integrity and good name of FedEx and its employees." More from the Journal:

FedEx repeatedly has asked for a list of online pharmacies that are illegally shipping prescription drugs, Mr. Fitzgerald said, something law-enforcement officials haven't yet provided. "Whenever DEA provides us a list of pharmacies engaging in illegal activity, we will turn off shipping for those companies immediately," he added.

"We are a transportation company—we are not law enforcement," Fitzgerald said.

[Image via AP]