New York City in a civil suit accused FedEx of violating an agreement to stop delivering untaxed mail-order cigarettes to city residents, the Associated Press reported.

Filed in federal court in Manhattan, the suit cites deliveries from a distributor on an Indian reservation in Long Island as proof FedEx was not honouring a 2006 agreement with New York’s attorney general, AP said. Between 2005 and 2012, FedEx delivered at least 55,000 cigarette cartons to city residents, the city claimed.
New York is seeking restitution of USD 825,000 (EUR 599,000) in lost tax revenue and almost USD 2.5 million in penalties, AP said. FedEx in a statement reportedly said it supported efforts to eliminate shipments of illegal cigarettes, but that the city’s claims were overstated and not founded in law. The delivery company said it no longer accepts shipments from the distributor named in the suit.