U.S. Sues Union Pacific Over Drugs

The U.S. government filed two suits against Union Pacific Railroad for allegedly “failing to prevent the use of its railcars to smuggle large quantities of narcotics into the United States” from Mexico, but the carrier was already contesting related fines in a suit it filed last summer.

The Justice Department said complaints filed in San Diego and Houston seek nearly $38 million in penalties for drugs found in freight cars entering from Mexico at Calexico, Calif., and Brownsville, Texas, beginning in 2001.

UP says it is and has been doing all it should to meet the law on border security arrangements, and even more, but has long resisted fines imposed out of these and related incidents by the Department of Homeland Security.

Donna Kush, UP’s assistant vice president for communications, said the railroad sued DHS last July rather than accept reduced fines amounting to 10 percent of the total. “Paying the fines would be admitting guilt,” she said. “Therefore, we are not paying them.”

UP, headquartered in Omaha, filed its suit there in the U.S. District Court. The government was under a deadline to respond by midnight on March 20, she said, “and I assume this is their response.” The Justice suits against UP involve nearly all the drug-related fines UP was suing to remove.

UP issued a response to the Justice announcement that cited its Nebraska court filing, and said “it is the government, not Union Pacific, that takes initial control over rail cars entering the U.S. from Mexico. Union Pacific believes that it has exceeded its legal obligations and will defend these duplicative lawsuits.”

UP is the largest provider of rail transportation services in North America, Justice noted, with substantial rail operations in Mexico and border gateways in California, Arizona and Texas.

In announcing the new government action, Justice officials said freight carriers have to make sure their equipment carries nothing more than what they submit to inspectors on cargo manifests.

“Along with the profits of doing an international transportation business comes the legal obligation to ensure contraband is not also brought into our country," said Tim Johnson, acting U.S. attorney for the Southern District of Texas.

The complaints list 37 occasions in California and one in Texas when border inspectors found marijuana or cocaine in the rail cars. Kush said, however, that when the drugs were found UP had not yet taken possession of the rail cars coming in from Mexico, but it was fined anyway and at times its railcars were seized.