UPS 2015 Annual Report Download - page 112

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UNITED PARCEL SERVICE, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
100
In January 2014, we received a Civil Investigative Demand from the DOJ seeking documents related to possible damages
under the False Claims Act ("FCA") in connection with delivery services provided to government customers where guaranteed
commitment times allegedly were not met. The General Services Administration - Office of Inspector General had previously
sought similar documents. We also have been contacted by multiple states requesting this information. The Company
cooperated with these inquiries and has reached agreements with the DOJ and a group of state and local governments to resolve
all of their respective claims. The terms of the settlements did not have a material adverse effect on our financial condition,
results of operations or liquidity.
In February 2015, the State and City of New York filed suit against UPS in the U.S. District Court for the Southern
District of New York, arising from alleged shipments of cigarettes to New York State and City residents. The complaint asserts
claims under various federal and state laws. The complaint also includes a claim that UPS violated the Assurance of
Discontinuance it entered into with the New York Attorney General in 2005 concerning cigarette deliveries. Discovery is
ongoing. There are multiple factors that prevent us from being able to estimate the amount of loss, if any, that may result from
this case, including: (1) we are vigorously defending ourselves and believe we have a number of meritorious factual and legal
defenses; and (2) it remains uncertain what evidence of their claims and damages, if any, plaintiffs will be able to present.
Accordingly, at this time, we are not able to estimate a possible loss or range of loss that may result from this matter or to
determine whether such loss, if any, would have a material adverse effect on our financial condition, results of operations or
liquidity.
We are a defendant in various other lawsuits that arose in the normal course of business. We do not believe that the
eventual resolution of these other lawsuits (either individually or in the aggregate), including any reasonably possible losses in
excess of current accruals, will have a material adverse effect on our financial condition, results of operations or liquidity.