DHL Hit with Class Action Over $17 Service Fee Allegedly Misrepresented as Import Duty ‘Reimbursement’ [UPDATE]
Last Updated on January 25, 2022
Martin v. DHL Express (USA), Inc.
Filed: July 6, 2021 ◆§ 3:21-cv-13363
A class action alleges DHL has failed to disclose an unauthorized $17 service charge that the logistics provider falsely represents as reimbursement for import duties.
New Jersey
Case Updates
January 25, 2022 – Lawsuit Dismissed
The judge overseeing the case detailed on this page has granted DHL’s motion to dismiss, agreeing with the defendant that the plaintiff’s claim is preempted by federal law.
Although the plaintiff claimed in his amended complaint that DHL had breached its contract with him by charging more than the agreed amount, the defendant argued that his breach of contract claim was really a “thinly veiled fraud or misrepresentation claim” and is thus preempted by the Airline Deregulation Act and Federal Aviation Administration Authorization Act.
In a January 20 order, U.S. District Judge Peter G. Sheridan sided with DHL, finding that there was no breach of contract and that the plaintiff’s claim is closer to a fraud or unjust enrichment claim, which are preempted by federal law.
Judge Sheridan noted, however, that despite this “draconian preemptive provision,” the plaintiff can still seek relief by bringing an action before the U.S. Department of Transportation.
A proposed class action alleges DHL has failed to disclose to customers an unauthorized $17 service charge that the logistics provider falsely represents instead as reimbursement for import duties.
The 23-page lawsuit contends that the $17 fee charged by DHL Express (USA), Inc. is not any type of import duty, tax or other government-mandated charge and is imposed upon recipients of goods shipped from outside the U.S. despite the fact that it is the seller, and not the recipient, who chooses to utilize the company’s services.
“In almost all such transactions, it is the seller who selects DHL as the shipper of the goods purchased,” the lawsuit, filed in New Jersey, says. “In such circumstances, the purchaser/recipient has no written agreement with DHL and no say in the hiring of DHL to ship the goods in question or the terms imposed by DHL.”
After purchased goods are transported into the United States by DHL, the company sends the purchaser/recipient an email notice, entitled “Import Duty Payment is Required,” that contains uniform language claiming DHL Express has “paid the duty for your parcel” and demanding a specified amount be paid to the company, the lawsuit begins. The notice then goes on to state that if the duty is not paid within five days, “the parcel will be returned to the shipper,” the suit says.
Once the buyer/recipient pays the full amount of the import “duty” demanded by DHL, the company sends a second written notice confirming the payment, per the case. Thereafter, the imported package is delivered to the recipient, the suit states.
In reality, however, the written description provided by DHL about the “import duty” is false, deceptive and misleading in that the $17 fee does not consist of any import duty, tax or government-mandated fee, and the amount is not paid to any governmental entity but is instead kept as a source of profit by DHL, the lawsuit alleges. According to the case, DHL’s notices about the fee do not reveal that any part of the amount demanded from proposed class members is not an import fee and is instead an additional charge being imposed by the company.
“Rather, the DHL notice simply demands a single flat amount that consists of both the $17 charge imposed by DHL and the amount of any import duty or tax owed, with the notice describing the entire amount as a ‘duty’ and/or ‘import duty’ which must be paid by the recipient,” the complaint reads, calling the alleged fee practice “sharp, deceptive and unconscionable.”
The lawsuit asserts claims under the New Jersey Consumer Fraud Act and the state’s Truth in Consumer Contract Warranty and Notice Act. Initially filed on June 2 in Mercer County Court, the case was removed to New Jersey District Court on July 6.
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