UPS 2011 Annual Report Download - page 61

Other Matters
In May and December 2007 and August 2008 we received and responded to grand jury subpoenas from the
DOJ in the Northern District of California in connection with an investigation by the Drug Enforcement
Administration. We also have responded to informal requests for information in connection with this
investigation, which relates to transportation of packages on behalf of on-line pharmacies that may have operated
illegally. We are cooperating with this investigation and intend to continue to vigorously defend ourselves. There
are multiple factors that prevent us from being able to estimate the amount of loss, if any, that may result from
this matter, including (1) we are vigorously defending ourselves and believe we have a number of meritorious
legal defenses and (2) there are unresolved questions of law and fact that could be important to the ultimate
resolution of this matter. 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 received a grand jury subpoena from the Antitrust Division of the DOJ regarding the DOJ’s
investigation into certain pricing practices in the freight forwarding industry in December 2007.
In October 2007, June 2008 and February 2009, we received information requests from the European
Commission (“Commission”) relating to its investigation of certain pricing practices in the freight forwarding
industry, and subsequently responded to each request. In February 2010, UPS received a Statement of Objections
by the Commission. This document contains the Commission’s preliminary view with respect to alleged
anticompetitive behavior in the freight forwarding industry by 18 freight forwarders, including UPS. Although it
alleges anticompetitive behavior, it does not prejudge the Commission’s final decision, as to facts or law (which
is subject to appeal to the European courts). The options available to the Commission include taking no action or
imposing a monetary fine; the range of any potential action by the Commission is not reasonably estimable. Any
decision imposing a fine would be subject to appeal. UPS has responded to the Statement of Objections,
including at a July 2010 Commission hearing, and we intend to continue to vigorously defend ourselves in this
proceeding. We received additional information requests from the Commission in January and July 2011, and we
have responded to those requests.
In August 2010, competition authorities in Brazil opened an administrative proceeding to investigate alleged
anticompetitive behavior in the freight forwarding industry. Approximately 45 freight forwarding companies and
individuals are named in the proceeding, including UPS, UPS SCS Transportes (Brasil) S.A., and a former
employee in Brazil. UPS will have an opportunity to respond to these allegations.
We are cooperating with each of these investigations, and intend to continue to vigorously defend ourselves.
There are multiple factors that prevent us from being able to estimate the amount of loss, if any, that may result
from these matters including (1) we are vigorously defending each matter and believe that we have a number of
meritorious legal defenses; (2) there are unresolved questions of law that could be of importance to the ultimate
resolutions of these matters, including the calculation of any potential fine; and (3) there is uncertainty about the
time period that is the subject of the investigations. Accordingly, at this time, we are not able to estimate a
possible loss or range of loss that may result from these matters or to determine whether such loss, if any, would
have a material adverse effect on our financial condition, results of operations or liquidity.
In January 2008, a class action complaint was filed in the United States District Court for the Eastern
District of New York alleging price-fixing activities relating to the provision of freight forwarding services. UPS
was not named in this case. In July 2009, the plaintiffs filed a first amended complaint naming numerous global
freight forwarders as defendants. UPS and UPS Supply Chain Solutions are among the 60 defendants named in
the amended complaint. We intend to vigorously defend ourselves in this case. There are multiple factors that
prevent us from being able to estimate the amount of loss, if any, that may result from these matters including:
(1) the magistrate judge recommended that the district court grant our motion to dismiss, with leave to amend,
and the scope of the plaintiffs’ claims is therefore unclear; (2) the scope and size of the proposed class is
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