Justice Department Investigates UPS and FedEx

Updated

The U.S. government is investigating the country's two largest shipping companies, UPS (UPS) and FedEx (FDX), over their policies aimed at preventing customers from using third-party consultants to negotiate lower shipping rates.

UPS (UPS) is being investigated by the U.S. Justice Department, while FedEx (FDX) is the subject of a similar probe by the Justice Department's antitrust division, CNBC reported.

The probe follows a lawsuit that AFMS, a third-party vendor, filed against the companies. UPS and FedEx customers saved more than $100 million on shipping fees between 2007 and 2009 by using such consultants, according to the lawsuit.

UPS spokeswoman Susan Rosenberg says the company has filed a motion to dismiss the claim. She also confirmed the federal investigation, saying the Justice Department has requested "information about UPS' policies and our right to decline to deal with third-party negotiators." She added that she didn't know how long the DOJ planned to investigate UPS.

A Justice Department spokeswoman declined to comment on the investigation, and FedEx also didn't respond to a request for comment from DailyFinance.

Both companies last year appeared to benefit from a rebound in consumer and business spending. FedEx's net income for the six months ended Nov. 30 surged 26% to $663 million as revenue rose 15% to $19.1 billion. UPS's profit for the nine months ended Sept. 30 jumped 70% to $2.37 billion as revenue rose 9.7% to $36.1 billion.

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