September 27, 2018 / 3:44 AM / 3 months ago

U.S. court dismisses NY lawsuit against FedEx over cigarettes

FILE PHOTO: A FedEx delivery truck is seen in New York City, December 16, 2010. REUTERS/Mike Segar

(Reuters) - A federal judge in New York dismissed a lawsuit on Wednesday against FedEx Corp (FDX.N) in which New York state and New York City claimed that the package delivery company had shipped untaxed cigarettes, cheating both out of tax revenue, according to a court document.

The lawsuit, which was filed against FedEx Ground Package System Inc and FedEx Freight Inc, had sought penalties under the Contraband Cigarette Trafficking Act, which prohibits shipping contraband cigarettes.

In his ruling, Judge Edgardo Ramos noted the complaint simply alleged that, sometime within a 10-year span, FedEx made shipments totalling over 10,000 cigarettes. “Without further details, there is insufficient factual content to ‘draw the reasonable inference that the defendant is liable for the misconduct alleged.’”

Ramos said the plaintiffs could appeal and re-file their complaint by Oct. 31.

“At FedEx Ground, we are committed to honouring the privacy of our customers, who trust us to transport their packages safely and securely. We take that trust very seriously and will continue to defend our position in the pending litigation,” a FedEx spokeswoman told Reuters.

Reporting by Aakash Jagadeesh Babu and Ishita Chigilli Palli in Bengaluru; Editing by Leslie Adler and Gopakumar Warrier

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