FedEx Charged With Shipping Drugs For Illegal Online Pharmacies | Hacker News Reader

FedEx Charged With Shipping Drugs For Illegal Online Pharmacies

npr.org

100 pointssizzle61 comments

This is stupid.

I've had severe asthma since I was a small child. It's hospitalized me a couple of times. I'm fairly healthy now, but I still try to keep a rescue inhaler within 20 minutes' reach all the time, because something might still trigger an asthma attack and it can get deadly really fast.

Those stupid inhalers have only gotten more expensive and more difficult to get over the years. Sans insurance, a few years ago I used OTC Primatine, which wasn't great, but mostly did the job. Then those were all banned in the U.S. because of the accelerant they used and nothing showed up to take their place. (Oh, except for homeopathic rescue inhalers, now sold on shelves at major drugstores throughout the U.S. -- so just to bruise this dead horse a little bit more, in the U.S. real emergency medication for a common medical condition is hard to get, but magic water for the same thing is available everywhere.)

After paying a visit to a doctor and going through the whole 20 minute interview and all that nonsense, I can be given a prescription for a $70 inhaler.

Or, knowing exactly what I need, I could order it from a Canadian pharmacy where the cost of exactly the same inhaler is less than the cost of shipping.

$70 and a doctor's visit isn't a big deal for me anymore. But a few years ago it was, and it still is for an awful lot of people.

Asthamtic here; I feel ya. However, I can also walk into a pharmacy here (Ireland) and explain to them that I'm an asthmatic, and need a releiver inhaler. They will give an "emergency" inhaler, (same inhaler, no questions asked) over the counter and ask me nicely to go to the doctor for the next one.

You're probably an edge case. The vast majority of people who are ordering from online pharmacies are doing so because they think they know what they're doing, and because they feel X or Y, they should take Z. This isn't really a problem with inhalers per se, because the amount of them you are required to ingest is actually pretty damn high before you are in any danger, but for stuff like prescription painkillers, people are self medicating and avoiding doctors visits for issues that they should be seeing a professional for.

I tried the pharmacy counter approach once at several pharmacies, they wouldn't do anything without a prescription from a doctor. In the U.S., asthma inhalers are used by a few silly teenagers to get "high" (for those without asthma: effective rescue inhalers are corticosteroids that as a side effect also accelerate your heart rate). The reaction in the U.S. of course has been to make the rescue inhalers difficult to get for the ~25 million people in the country with the condition.

I would want to see some estimates on how many people are actually abusing online pharmacies to harm themselves or others vs. people using them legitimately to get medication that's otherwise unavailable or too expensive locally. I know at least a couple of women that use them for birth control, because there's a product available that way that isn't available in the U.S., that has less of a hormonal impact than the usual stuff. (I don't know the name of the product or anything else about it, though.)

As far as abuse goes, I suspect that abuse of ADHD drugs might be somewhat common, and I'd bet there are at least a few on HN doing that (because it's been discussed before), and honestly I find it difficult to care at all about that kind of abuse.

I don't think that further removing access to affordable medication is the right way to get people to see a doctor.

From an internal memo about more stringent credit policies for internet pharmacies: "Many of these companies operate outside of federal and state regulations over the sale of controlled drugs, which require diagnosis and prescription by a licensed physician. Drugs purchased from these sites may be diluted or counterfeit."

To believe that FedEx lacked knowledge of illegal activity, one must believe that they assumed some of these pharmacies were genuine and that while it was feasible to create special policies to ensure FedEx was paid, policies to verify the organizations legitimacy (which would also increase the chance of them being paid), were impractical. However, that will be difficult because one executive told another that: "...these types of accounts will always result in a loss at some point. They have a very short lifespan and will eventually be shut down by the DEA." (emphasis added)

They certainly can't argue, as many others in this thread have, that the companies weren't identifiable: They were doing it to enforce this policy. The credit department maintained a list of pharmacies that, at one time, had 600 entries on it.

Based solely on your quotations, I would use the following analogy:

Suppose you like to buy and sell bags full of chocolate eggs. You know from past experience that roughly 10% of the foil-wrapped eggs are spoiled, but the only way of knowing which 10% of the foil-wrapped eggs is to cut them all open, which would be uneconomical and destroy the entire value of the product.

So maybe FedEx knew that P(illegal|pharmacy) was greater than P(illegal), but that P(illegal|pharmacy) was still too low compared to P(pharmacy) to justify shutting down all pharmacies.

Always is an odd characterization of something that occurs 10% of the time.

Edit to respond to comment: The context is a an executive talking about whether accounts that FedEx classifies as internet pharmacies should be counted towards sales goals used for bonuses. That means they could classify new accounts as belonging to this group or not. It's worth noting that their definition is likely not synonymous with the plain meaning of internet pharmacy. Rather it means that subset that they expect the DEA will put out of business. I'm sure Caremark isn't excluded from normal sales metrics and subjected to extraordinary credit requirements.

"Always" could be referring to the x% subset. Does the context of the quote say which interpretation is correct?

The DEA wants to be able to inspect these packages, under the guise of catching drugs. They ask FedEx, let us just come in and open what we want, and they said fuck off.

So now the theory is, just prosecute FedEx for not being law enforcement. FedEx has two choices; fight a costly battle and possibly lose, or settle the charges in exchange for letting the DEA run hog wild.

Putting on the squeeze.

And everyone starts using another carrier.

It seems like all the major carriers cooperate to some degree. This is an interesting article from back in 2012, with many good quotes from UPS/DHL/FedEx: http://www.talkleft.com/story/2012/11/16/183045/99/crimenews...

The parts about opening up direct database access to law enforcement was disappointing but not surprising.

USPS in theory actually provides better protection because US mail has stronger legal protections than handing your package off to a private entity.

It'd be one thing if people were mailing stinky weed and FedEx were turning a blind eye, but how are they supposed to check every package for substances / make sure every recipient has a prescription for controlled ones?

The DEA wants to warrantlessly search all packages going through private carriers. They've done this with UPS, but FedEx was rightfully telling them to fuck off and this is the price they pay.

This has been building for a while: http://www.thedailychronic.net/2013/16724/dea-targets-fedex-...

From the indictment: http://i.imgur.com/RnLKlRk.png

The indictment doesn't seem very well-written, because it's hard to figure out precisely what their "smoking gun" evidence is. They seem to assert:

1. "FedEx employees visited the fulfillment centers of Company X, where they witnessed controlled substances being packaged."

2. "FedEx ships packages from Company X."

3. "Therefore FedEx knowingly shipped controlled substances."

I'll be surprised if this sticks, though FedEx may settle out of court. FedEx employees visit e-commerce companies all the time but not to inspect product. They are there to sell shipping and service the shipping computers. Is a FedEx salesperson or computer serviceperson supposed to be an expert on drug identification? Does that person really know that the stuff in those pill bottles is a controlled substance?

Is it possible that perhaps the FedEx employees may have seen these so called "pill bottles" and were either told 1) they're legal supplements/medications or 2) had no clue what they were when they were observing the operation since they were only interested in the shipping logistics?

With just a cursory glance, it seems that it was written up by an overzealous federal prosecutor who wants to make his/her career's achievement busting a big company like FedEx as part of a massive drug ring with conflated charges.

The part about setting up special credit policies for these pharmacies so that FedEx wouldn't lose money when said pharmacies were shut down is pretty clear that they knew there was something wrong, but they turned a blind eye anyway.

could it be just some half-automated "big data"-style analysis identifying clients who are at higher risk of default and thus getting special credit policies. And i'd say it is a successful analysis at that if illegal pharmacies were among the businesses put into that set.

One can imagine how any reasonable automated classificator working over previous history would put a business with 2 such attributes like "business: pharmacy" and "location: foreign" into the category with higher risk.

As a side note - we have a "reasonable person" test in courts today, and, as more and more of things are being automated, i think we'll have a "reasonable automated classificator/learning system" tomorrow :)

That's definitely not what the indictment alleges.

beginning in June 2004, FEDEX established an Online Pharmacy Credit Policy that applied only to its Internet pharmacy shippers. Under this policy, all Internet pharmacy shippers had to be approved by the Credit Department prior to opening a new account. Existing Internet pharmacies had to be reviewed by the Credit Department to ensure that they had adequate financial security. In arguing for the Online Pharmacy Credit Policy, FEDEX's Managing Director of Revenue Operations stated "[a]s the past few weeks have unfolded it is becoming more apparent to us that many of these companies are fraudulent and doing business outside Federal regulations."

Not all online pharmacies are illegal. Think of companies shipping stuff like catheters, diabetic supplies, oxygen equipment....many of those require a prescription.

If they are shipping items that require a prescription without verifying a prescription, then they are illegal, regardless of what the items are

Online contact lens sellers (at least ones I've used) do verify your prescription. Is it up to FedEx to investigate whether their customers are required to and actually do verify prescriptions?

how do you know the prescriptions don't exist/weren't verified?

My point was merely that this (allegedly) was not just some automated anti-fraud measure as some people speculated here.

That's actually pretty standard when dealing with _any_ small business. So I wouldn't say that argument has any weight.

If FedEx is signing up these businesses under special terms like this (even if they are the same ones used for legitimate businesses), it would seem (from the outside) like they were looking closely enough at the business to recognize that something was fishy.

This is different than if FedEx was just accepting packages regularly from someone that kept dropping by at the local FedEx b&m store.

I don't have the full story, so I'll I can do is say that it raises the likelihood (even just a little bit) that FedEx could have known. I guess one of the relevant questions to ask would be: "Is it standard for FedEx to be so hands-off when signing these businesses up that they have no clue what the business even does?"

"Is it standard for FedEx to be so hands-off when signing these businesses up that they have no clue what the business even does?"

As far as I'm concerned it certainly should be. Is it next going to be illegal to sell snack foods to someone with munchies? Let the police be the police.

I'm not saying how anything should be. These types of deals are risk-management for FedEx. It seems highly unlikely that FedEx did no homework on businesses that it was entering into risk-management deals with.

> Is it next going to be illegal to sell snack foods to someone with munchies?

Why do you feel the need to trot out strawmen already?

I was just saying that FedEx entering into such agreements just increases the likelihood that they knew something. I didn't even say by how much. I definitely said nothing about whether they should be criminally or civilly liable for anything. The question that you posted wasn't even meant to be rhetorical. I was actually raising the question because it's relevant information.

I'm basically siding with no one here, and just making passing observations. It would be nice to not be attacked for it.

[Edit: I guess I should add that the 'something' they might have known need not have been actionable information, or even information that makes them liable for anything. I'm just stating that it makes them more involved with said companies than, say, me if I ship a package from a FedEx store. FedEx, for example, probably knows about their revenue and shipping logistics to be able to evaluate their risk-management formulas...]

I didn't intend my comment as a personal attack, or even a direct reply. So I apologize that my wording gave that impression.

However, I stand by my position that it shouldn't matter what FedEx knows or "could/should have known." FedEx is not the police. I also stand by my slippery slope straw man, because history has already shown that this type of expansion of civilian liability and law enforcement powers doesn't have an end goal. There is no "enough."

Or maybe it's just another name for a pre-paid account.

While I understand this is a (unsolvable?) problem, a bunch of cowboys from the DEA throwing their weight around is a terrible outcome. The last thing anyone needs right now is more regulation around core economic activities like shipping and e-commerce.

This is one way that the government forces businesses into law enforcement. Look for a settlement that has FedEx reducing anonymity, snooping in packages, and snitch...er, disclosing evidence to proper LEOs.

It's frustrating that there's no link to the actual indictment. I want to form my own opinion, not have it formed by a news article.

Here you go: https://consumermediallc.files.wordpress.com/2014/07/fedex-i... [1]

[1] http://consumerist.com/2014/07/17/fedex-indicted-for-shippin...

Federal Highway Administration shares some responsibility in this, as well.

This made me chuckle, because now I'm imagining that all taxpayers could also be considered partially responsible. We send money that is used on road improvements and projects and therefore critical to the transportation of controlled substances!

A couple of days ago one of my kids asked me I could give an example of something that was illegal but not immoral. We had a nice conversation working through the difference between the two. It was interesting to break things down into categories of:

1. Immoral and should be illegal.

2. Immoral but shouldn't be illegal.

3. Moral but should be illegal.

4. Moral and shouldn't be illegal.

Stories like this seem to me to be category 4 but I can understand how some people may see it as a 1.

I'd be interested to hear more about category 3.

The two examples most familiar to me are the Jean Valjean scenario (stealing for survival) and the Jack Bauer scenario (coercion or torture to save lives).

In both cases, there's an argument that the underlying activity (theft, torture) should remain illegal. It would be difficult or impossible to codify all the permissible extenuating circumstances, and leaving the question open-ended and letting it be decided in court would be a disaster, much worse than existing carve-outs like self defense as an excuse for homicide (which is itself kind of a mess, legally).

Certain dour strains of penal theory would argue that the 'virtuous criminal' still requires equal punishment (Chinese legalism, for example), but I think the more popular stance in the modern day is that judges and state executives (governors, presidents) should have the option of leniency. This takes the fate of Jean Valjean outside the sphere of law and exposes it to popular opinion -- an unreasonable act of clemency would be faced with blowback (just ask Mike Huckabee).

...the Jack Bauer scenario...

I find 24 to be much more interesting when I view Bauer as a second villain, rather than the unquestionable hero as it seems he's portrayed.

Indeed, the series is far more enjoyable if you picture Bauer as the pawn of an elusive cryptoregime furthering its dark agenda. Lots of things work better that way. I kept waiting for the character in the video game "Splinter Cell" to figure out that he was being played by global corporatist puppetmasters, but unfortunately the plot never got there.

I kept waiting for the character in the video game "Splinter Cell" to figure out that he was being played by global corporatist puppetmasters, but unfortunately the plot never got there.

Brilliant idea for a community remake or mod!

Off-topic: Jean Valjean as described in a book would not gain much by being exposed to popular opinion and definitely not by the society back then. His first crime have been party out of desperation, but the rest was just him being impulsive and not thinking even five minutes ahead.

He was very close to current low socioeconomic status (ghetto) boy stereotype - those do not get breaks nor lower sentences.

Yup. And that's a flaw in the approach. I don't think it's possible to have a merciful justice system in a merciless society in the first place, though. If judges are insufficiently bloodthirsty, they will be replaced, or their judgments will be supplemented with vigilante action.

That's a flaw in the approach? What is the benefit of being merciful to those who commit crimes out of "being impulsive and not thinking even five minutes ahead"?

Things like "Keep of the grass". Where if just a few people do something there's not a problem but where if too many people do it it could cause bigger problems.

I think most political arguments come down to what should or shouldn't be illegal but get confused with what is moral or not.

There's a pretty good argument that intentionally disobeying the law in the commission of a normally morally neutral act is itself immoral. If a useful, just law is routinely flouted, eventually the usefulness of that law will collapse. If many such laws are frequently disregarded, eventually the credibility of the legal authority will be lost. (This is a good argument for not passing unenforceable or excessively strict laws.)

One of the interesting things about laws is that in many cases people follow them without regard for the consequences of not following them. A society where people will obey laws because they are valid, just, and reasonable is much better than one where they obey laws because the alternative is a flogging or hanging.

Vigilante justice.

If a poor person with no other options stole a loaf of bread from someone well off to feed their kid, I would consider it entirely moral. But theft should still be illegal.

What part don't you understand? Why FedEx is in trouble or why the pharmacies are illegal? I'm going to assume it's the latter and it's a bit of a gray area.

On the one hand, these pharmacies provide medications at a lower cost than in the US and some countries and would be beneficial to many. So far it looks like its moral and shouldn't be illegal.

Then we begin to think about the people who go online and buy medications they aren't prescribed, playing doctor on themselves. We can say that's their own problem but I'd side with the idea that it does more harm than good.

Then there's the fact that these pharmacies often prey on drug addicts who require treatment, not more drugs.

There's way more to it than that but regardless, it's pretty easy to see why people would be believe they fit into category 1.

Surely some form of "common carrier" applies. Otherwise innocent service has no reason/obligation/expectation to evaluate what they're transporting (be it data or products), and short of the gratuitously obvious/heinous has no responsibility for anything other than successful delivery.

Surely some form of "common carrier" applies.

I'm not sure what you mean by that. (I'm not sure if you are writing as a lawyer, or as a member of the general public.) I remember attending a trial in the late 1980s in which a UPS driver testified that he discovered an illegal drug shipment because he thought the shipment looked funny and he opened up the package. Further testimony at that trial disclosed what we should all know if we read the fine print of our contracts with common carriers like UPS or FedEx: the carrier has the right to open any package for any reason or no reason at all (in the interest of the safety of the carrier's employees, safety both from actual physical danger and safety from legal liability). The person who delivers packages to your door through the service of one of those companies can do a lot by way of inspecting those packages before delivering them to you, unless something very radical has changed about those contracts in the years since I heard that trial. (Does anyone here on HN have a full standard form contract of carriage from FedEx to post here for us to check the current wording?)

AFTER EDIT: Of course I found this myself with a very easy Google search. FedEx's standard terms and conditions include:

"9. Right to inspect. FedEx may inspect the shipment at any time and may permit government authorities to carry out such inspections as they may consider appropriate. FedEx, in addition, may reject or suspend the carriage of any prohibited items or one that contains materials that damage or may damage other shipments or that may constitute a risk to FedEx equipment or employees or to those of its service providers."

http://www.fedex.com/mx_english/services/nacional_terms.html

FedEx may have the right to open a package, but do they have the obligation?

I think the government's stronger case is that FedEx maintained a special credit policy specifically for online drug pharmacies who were at risk of being shut down by the DEA.

One important question that I don't know the answer to: Are any online pharmacies legal in the US? If they're unilaterally illegal in the US, and FedEx had a special credit policy for online drug pharmacies, then it would seem to be straightforward to prove they were knowingly shipping controlled substances. If some online pharmacies are legal, and FedEx was maintaining special relationships with online pharmacies, then was FedEx required to verify that those weren't conducting illegal activity?

I don't like that the government is forcing its citizens who are running private businesses to be concerned with whether their business is being used as an accessory by drug dealers. The government should go after the source: the dealers. But in this case, FedEx was making a lot of money (enough to noticeably affect revenue) by knowingly acting as a conduit.

Shipping prescription drugs via mail is legal in the US, though it obviously isnt legal to sell them without a prescription. Not sure how the law applies if the pharmacy is in a foreign country, or if the drugs are scheduled, though.

And, in case anyone missed it, there are things that are OTC here in Canada that are Schedule III in the US. My personal favourite is what is variously called AC&C or 222, a tablet containing 375mg ASA, 15mg caffeine and 8mg codeine phosphate — perhaps the best safe combination for occasional migraine-type headaches. (You need to register and sign for them in Quebec, a measure that's intended to prevent bulk purchases, but you're on your own say-so elsewhere; you merely need to ask at the pharmacy counter and they'll give you the safety drill if you're a first-timer.) Useful damned things to have around if you're susceptible. But totally illegal to have without a scrip in the States.

Sure, they can open a suspicious package. And for the situation at hand, they'll find medication available at most pharmacies - the problem isn't that the contents are illegal (they're not per se), it's that the shipper is guilty only of paperwork violations!

So yeah, FedEx is exonerated in this case because they're in no position to evaluate the legality of the contents as that is determined, not by simple possession, but by materials (regulatory filings) which they are absolutely not privy to.

Definitely not. They're not the post office and for that reason the police can just ask to see your mail. And they'll show it to them. The post office need to see a warrant. It's like how your papers need a warrant and your email doesn't (after a year in the US). If a company has it it doesn't qualify as private papers.

For this reason, vendors on darknet markets almost exclusively use USPS for domestic shipping.

This is insane. We need to end the drug war.

This isn't even the drug war. It's middle aged men buying Viagra from pharmacies in India. I'm probably a minority, but I would prefer to sign a waiver and then buy my own drugs. Rather than have to pay a doctor to prescribe me something I already know I need. I'm insulin dependent, and monitor my blood sugar regularly, and will continue to do so for the rest of my life. I know far more about how my body reacts to insulin than the doctors do. I should be able to buy it without a prescription. True story: 8 years ago I was hospitalized for several months due to a bad motorcycle accident. The doctors kept prescribing me insulin that I told them was too much, and badly timed for me, but the did anyway. After a week it compounded, until my blood sugar was in the high 20s (coma territory.) of course because I was bedridden and doped up on Demerol I couldn't feel the signs of hypoglycemia. After that they relented and told the nurses to (within a wide range) administer the amount I asked for.

They didn't check your blood sugar while busy giving you this? Jesus, which country was this?

Shoot the messenger much

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