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Feds sue UP for failing to prevent drug trafficking; government, not railroad, controls border-crossing cars, Class I says


The U.S. Department of Justice (DOJ) recently filed two lawsuits against Union Pacific Railroad seeking a total of $37 million in penalties for allegedly failing to prevent the use of its rail cars to smuggle large quantities of narcotics into the country.

Government officials claim the cars carried cocaine and marijuana across the border at ports of entry in Calexico, Calif., and Brownsville, Texas.

UP has a substantial ownership-interest in Ferrocarril Mexicano S.A. de C.V. and partners with the Mexican railroad to offer customers the ability to move merchandise north and south between Mexico and the United States, the lawsuits state. In accordance with U.S. law, the owner or person in charge of a vehicle bound to the United States is required to submit to the U.S. Department of Homeland Security (DHS), Customs and Border Protection (CBP), a manifest that accurately identifies all merchandise on board the vehicle, the DOJ said.

On 37 separate occasions between November 2001 and October 2006, UP submitted manifests and CBP officials found more than 4,000 pounds of marijuana on the railroad’s cars heading northbound from Mexico to the United States, the DOJ claims. CBP imposed mandatory penalties totaling $33.6 million to date, but UP “failed and refused to pay the civil penalties,” the suits state.

"Railroad companies and other freight carriers must take seriously their obligations under the law to take appropriate action to prevent the use of their vehicles to smuggle narcotics and other contraband into the United States," said Karen Hewitt, U.S. attorney for the southern district of California, in a prepared statement. "This civil complaint marks an important step toward addressing the repeated failure of the largest railroad company in North America to prevent rail cars bound for travel throughout the United States from being used to smuggle significant amounts of narcotics."

However, as UP officials explained in a lawsuit filed against DHS in July 2008, it is the government, not the Class I, that takes initial control over rail cars entering the country from Mexico, UP officials said in an email. CPB is “punishing Union Pacific for drug smuggling that the company has no ability to prevent,” they said, adding that the railroad has exceeded its legal obligations and will defend itself against “these duplicative lawsuits.”

UP initiated the lawsuit against DHS last year because railroad officials believe CBP is violating federal law in taking legal actions when the Class I has no ability to prevent the drug trafficking, UP officials said. For years, UP has been a strong supporter of CBP in protecting U.S. borders and preventing illegal drugs from entering the country. In addition, the Class I has provided millions of dollars in annual financial support, constructed buildings for CBP, trained federal officers, and deployed its own private police and K-9 squads, UP officials said.

Contact Progressive Railroading editorial staff.

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