Well, you’ve got to hand it to them: if we’re going to say that corporations are people, then we need to start subjecting them to criminal sanctions for committing victimless crimes. It’s only fair. So it’s heartening this morning to see that the government has secured an indictment — based on a 9-year investigation — of a major corporation for dealing drugs. Welcome to personhood in America!
And this is not some pharma company trying to get America hooked on the new Prozac. We’re talking about a non-pharma company peddling illegal drugs and getting called out on it by the feds….
The late, great Mitch Hedberg had a joke: “I like the FedEx guy, ’cause he’s a drug dealer and he don’t even know it! And he’s always on time.”
Except, according to the federal government, he did know it.
Yesterday, FedEx was indicted for conspiring with online pharmacies to distribute prescription medicines illegally.
The 15-count indictment, handed down by a federal grand jury in San Francisco, includes charges for conspiracy to distribute controlled substances. FedEx allegedly gained at least $820 million from the conspiracy, the filing said, and could be fined up to twice that amount.
$820 million is a tidy little profit. As the FedEx senior leadership used to say, “first you get the money, then you get the power, THEN you get the S&P 500 corporation.”
On the other hand, is it really fair to ascribe criminal liability to FedEx for merely delivering what criminals send? In this case, the government makes a strong case that we shouldn’t see FedEx as an innocent bystander:
Beginning in 2004, the indictment said, FedEx was warned “on no less than six different occasions” that illegal Internet pharmacies were using its services to distribute prescription drugs. Senior managers were among those who received warnings, the filing said.
In one instance, FedEx knew the Drug Enforcement Administration had shut down one pharmacy, but continued to ship packages from its affiliates. FedEx also developed policies and procedures that allowed it to continue shipments, the indictment said.
For example, some drivers in Kentucky, Tennessee and Virginia said they had been stopped on the road by customers demanding packages of pills. Delivery addresses included parking lots and vacant homes where people would wait for pharmaceutical deliveries, the indictment said.
“Sir, can you sign here? Lovely abandoned shack you have.”
FedEx plans to plead not guilty. The present spin is that the government’s case represents an assault on the privacy of FedEx customers, hoping to seize on the metanarrative of a government run amok and trampling your privacy. That may tap into some public sympathy, but beating the rap will take more than an anti-authoritarian sob story. Forcing delivery companies to engage in Know Your Customer processes would seem like invasive overkill, but that’s a far cry from holding FedEx to the standard, “Hey, when the return address is a company identified as a criminal enterprise… yeah, go ahead and not deliver that.” Ultimately it’s a question of what FedEx knew and when the company knew it. Unfortunately for FedEx, the indictment suggests “everything” and “from the beginning.”
If the indictment is accurate, this isn’t about a company respecting the privacy of its customers, but an incredibly arrogant corporate enterprise deciding that the rules couldn’t possibly apply to them and flouting authority in pursuit of millions in profits hoping that the hammer — if it ever fell — would be the kind of slap on the wrist corporations usually get for breaking the law. When the incentives are set up to make it profitable to break the law, then that’s what a rational corporate person will do.
Criminal defendants at the bottom of society get bullied into trumped up settlements and those at the top get to take minor haircuts on their profits. And if FedEx really did everything alleged and settles with the government at a discount off the $820 million in profits, it says everything about just how inequitably America treats its criminal defendants.
In the meantime, FedEx would be well served to scrap that new ad campaign — FedEx: When your illegal drugs absolutely positively have to be there overnight.
Check out the full indictment….