eBay Inc., the global online marketplace, has settled for $59 million over allegations that it violated the Controlled Substances Act by allowing the sale of pill presses and encapsulating machines through its website. The U.S. Department of Justice revealed that the sales included equipment that could be and has been, used by criminals to make counterfeit drugs, some of which were potentially laced with the deadly opioid fentanyl. This marks the fourth-largest Controlled Substances Act settlement in history and notably the first with an e-commerce company.
As reported by the Justice Department, eBay’s issues with the CSA requirements revolved around the lack of appropriate checks, including insufficient identity verification for purchasers and inadequate record-keeping. Complicating the matter further, some buyers of these pill presses had also purchased counterfeit molds, making it possible for their home businesses to produce facsimiles of legitimate pharma products, thereby potentially feeding the nation's opioid crisis.
In a statement obtained by the Justice Department, Associate Attorney General Vanita Gupta emphasized the gravity of the situation, stating, “Counterfeit pills laced with fentanyl are a significant contributor to the deadly overdose epidemic.” She further asserted the government's commitment to employing "all available enforcement measures to ensure that companies involved in selling the equipment that makes it possible to create these dangerous pills comply with the Controlled Substances Act."
According to the Justice Department, eBay will be enhancing its compliance program to better regulate items prohibited or restricted under its policies, especially regarding the sale of pill presses and encapsulating machines. DEA Administrator Anne Milgram weighed in, noting that “eBay and other e-commerce platforms must do their part to protect the public. And when they do not, DEA will hold them accountable.” This move is expected to play a role in preventing such machines from falling into the wrong hands and reducing the spread of counterfeit pills.
The allegations resolved by this settlement have not, however, resulted in a determination of liability for eBay. They remain legally as allegations, although the monetary agreement and the pledge to overhaul its compliance procedures indicate eBay's recognition of the issues raised by the federal government and its law enforcement arms. The case was handled by a team of trial attorneys and Assistant U.S. Attorneys under the Justice Department's Civil Division’s Consumer Protection Branch, with significant contributions from officials in the Districts of Vermont and Tennessee.
