Potential whistleblower lawsuits are currently under consideration against FedEx Ground Package System Inc., FedEx Corp. and FedEx Corporate Services Inc. The three FedEx entities worked together to conceal and implement billing scams to overcharge customers anywhere from millions to billions of dollars. If a former or current FedEx employee successfully pursues a whistleblower lawsuit under the False Claims Act, they may be compensated up to 30 percent of the amount recovered by the government.
Whistleblowers are granted confidentiality under provisions of the False Claims Act; they are also protected against any punitive action by the FedEx companies.
If you are aware that FedEx engaged in the illegal activities mentioned above, we want to hear from you today. Parker Waichman LLP is offering free legal consultations to any insiders who have any information about erroneous charges.
FedEx Class Action Focuses on Allegations of Fraudulent Charging by FedEx
FedEx Ground, one of the top delivery companies in the U.S., processes some 3.5 million packages throughout the U.S. and Canada. While the information technology model that allows this performance has been praised – the company’s billing model leaves much to be desired. In fact, it has been termed as both convoluted and fraudulent and is believed to have purposefully been designed to facilitate and conceal billing scams, according to a class action lawsuit filed against the companies by Parker Waichman LLP.
Fed Ex Ground is alleged to be running two scams.
The first is called “upweighting” and is accomplished via the manipulation of FedEx Ground’s information technology system to falsely rate packages at higher weights than they actually are; this raises related fees, as the more a package weighs, the larger the fees.
The other scam involves FedEx charging U.S. customers Canadian customs/duties and related charges when they ship an item from the United States to Canada—even when the customer has noted that the Canadian recipient is to pay all Canadian-related fees. FedEx tells the U.S. customers that the Canadian-related charges could not be collected for some reason.
False Claims Act’s Whistleblower Provisions
The Civil War-era False Claims Act provides whistleblowers with protection and the opportunity for compensation. Amendments added to the Act in the mid-1980s helped to further incentivize whistleblowers to come forward by raising the amounts that can be levied for damages and penalties. As a result, whistleblowers can be awarded as much as hundreds of millions of dollars today—or between 15% and 30% of the amount recovered by the government. The False Claims Act allows private persons to file lawsuits on behalf of the government; such lawsuits are also known as “qui tam” actions.
In recent whistleblower lawsuits, Parker Waichman LLP has noted awards in the hundreds of millions of dollars. One example is Johnson & Johnson’s $2.2 billion settlement for a lawsuit over its drug Risperdal, which was alleged to have been improperly marketed. Several whistleblowers were involved in that case, with one of them due to receive $112 million, according to a Bloomberg report. Other whistleblowers were to receive $27.7 million and $28 million.