FedEx Files Lawsuit against US Government over Huawei Ban

FedEx, a major US delivery company has filed a lawsuit against the United States government arguing that it should not be required to enforce federal export bans.

The decision seems to have stemmed from a series of mishandled deliveries that resulted in FedEx failing to deliver a Huawei smart phone ordered from Britain to the United States.

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Last month, President Trump added Huawei to a list of Chinese companies that are barred from trading with US companies, without obtaining a special license.

The export ban means that Huawei has lost access to major chip makers like Intel and Qualcomm as well as the use of the Google-owned Android operating system.

Huawei set for massive loses

Huawei estimates it will lose 30bn dollars worth of revenue as a result of the blacklisting. US firms are also scrambling to understand the full extent of what the loss of this major customer means.

Google has warned the US government that the ban may result in an increased security threat if Huawei develops its own independent operating system for its phones and devices. FedEx argues that they are a transportation firm and not a law enforcement company.

FedEx pushes back on the ban

The company says the export ban imposed by the federal government "violates common carriers' rights" by making delivery companies responsible for the shipments that may contravene the restrictions.

The export law “essentially deputize FedEx to police the contents of the millions of packages it ships daily even though doing so is a virtually impossible task, logistically, economically, and in many cases, legally," the company said in its lawsuit.

A spokesperson for the US Commerce Department said they had not yet reviewed the lawsuit but would defend the federal government's right to impose the measures in the name of national security.

PCMag recently reported that FedEx failed to deliver a Huawei phone sent to its New York offices from an employee in London. 

Returned package a 'mistake'

The package was returned to the sender with a sticker saying “parcel returned by FedEx, due to US government issue”. PCMag said they were later contacted by FedEx who said the return of the phone was a mistake.

The delivery company issues a statement to the magazine saying:

“The package in question was mistakenly returned to the shipper, and we apologize for this operational error. As a global company that moves 15 million shipments each day, we are committed to compliance with all rules and regulations and minimizing impact to our customers as we adjust our operations to comply with a dynamic US regulatory environment."

FedEx will argue that they already go to great lengths to comply with trade and security laws. But the increased trade restrictions has placed an impossible burden on them and other delivery companies.