Law Paper

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Answer

Law Paper

            In a case involving illegal cigarette shipments, A United States court fined United Parcel Service Inc. (UPS) a total of $247 million in penalties and damages for the illegal shipping of huge quantities of the untaxed cigarettes into New York State and City (Reuters). Although UPS viewed the fine as excessive, the court upheld the fine observing that the huge fine will help in having a sufficient corporate impact on the company (Reuters). The firm, however, expressed its disappointment and vowed to appeal the ruling.

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            UPS (defendant), a package delivery company, was being sued by the plaintiffs, The State of New York and the City of New York for having delivered a large quantity of contraband cigarettes to individuals living in the state and City of New York. This was in contravention of the agreement that was entered into by the firm and the Attorney General of New York State in 2005 against unlawful service. According to the plaintiff, the UPS Company was supporting many other contraband cigarette trafficking businesses that led to the robbing of the State and the City millions of dollars in the form of tax revenues. Therefore, the State and the City wanted civil action to be taken against the company for the purposes of injunctive relief, penalties, and damages based on the as well as the Prevent All Cigarette Trafficking Act and the Contraband Cigarette Trafficking Act. The UPS firm was also to be charged under the Racketeer Influenced and Corrupt Organizations Act, New York Public Health Law section, abatement of a public nuisance, and Assurance of Discontinuance with the New York State Attorney General.

            The trial judge found the defendant guilty of all the offenses, thus was fined $247 million, of which the New York state was awarded $165.8 million dollar while the plaintiff New York City was awarded $81.2 million (Reuters). The legal issues that were being determined by the court included shipping of contraband cigarette into New York State, supporting cigarette trafficking enterprises, denying the state and the City millions of dollars in terms of unpaid taxes, endangering the lives of persons living in New York City and state, and discontinuance of an agreement that had been entered in 2005 with the New York State Attorney General. However, UPS Company defended itself by stating that the shipments at hand had generated for the state and the City a total of $1 million in revenues (Reuters). They, therefore, found the penalty excessive, unfair, and unconstitutional. They would therefore appeal the ruling.

            The ruling by the judge was fair because it aimed at preventing UPS Inc. from further engaging in illegal shipment of contraband goods. The company had failed to admit its errors even after previously entering an agreement with the New York State Attorney General not to engage in unlawful business. Besides, cigarette is a harmful substance hence the state limits its usage by imposing high taxes on it to make it unaffordable to most people, hence safeguard them from the health risks. UPS Inc. was competing unfairly with other business that engaged in lawful businesses. It had the advantage of bypassing tax payments. The ruling is important to business as it will help in the making other businesses follow the justified laws to avoid the hefty fines. In terms of law, it has set precedence for punishing firms that engage in illegal business with heavy fines t prevent them from further engaging in the vice.

Works Cited

Reuters. U.S. Court Fines UPS $247 Million over illegal Cigarette Shipments. CNBC, 25 May, 2017. Accessed from http://www.cnbc.com/2017/05/25/reuters-america-us-court-fines-ups-247-mln-over-illegal-cigarette-shipments.html[1 June, 2017].

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