New York City says lawsuits against other companies continue.
The New York City Law Department said this week it had settled a lawsuit it filed against the Virginia-based package delivery service LaserShip over residential deliveries of contraband cigarettes in New York City.
LaserShip agreed to a $5 million fine to resolve the city’s civil charges, brought under a variety of federal and state laws, including those prohibiting the distribution of untaxed cigarettes and residential cigarette deliveries.
“The conduct at issue in the case ended more than a year ago,” said LaserShip in a press release, adding that it has “subsequently taken significant measures to improve its compliance systems and internal controls to ensure such conduct does not occur in the future.”
In July 2010, Congress enacted the Prevent All Cigarette Trafficking Act, which, in addition to requiring cigarette sellers to ensure that all taxes had been paid on cigarettes shipped to consumers, prohibited the U.S. Postal Service from allowing cigarettes in the mail.
The city said that “in an attempt to skirt the requirements of the PACT Act, a group of upstate cigarette sellers retained Regional Integrated Logistics,a Buffalo, N.Y., logistics firm, to organize a package delivery network for the delivery of untaxed cigarettes nationwide.”
It said, “LaserShip was part of the package delivery network and from 2011 until June 2013, and made more than 23,000 deliveries of more than 120,000 cartons of untaxed cigarettes to stores, residences and offices throughout the city.”
New York said its separate action against Regional Integrated Logistics is continuing, as are lawsuits over deliveries of bootleg cigarettes by companies such as FedEx and YRC Worldwide.
LaserShip settles lawsuit over untaxed cigarettes
