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Alibaba settlement reflects DOJ's approach to food and drug cases

From CBS News · () English

Translated from English, summarized and contextualized by DistantNews.

At a glance

News Unnamed sources Outcome reported
  • Alibaba and its payment company allegedly failed to prevent the sale of dangerous drugs and chemicals for eight years, despite internal warnings.
  • Prosecutors believed they had evidence of felony violations of the Food, Drug and Cosmetic Act.
  • The case was resolved with a $600 million settlement and a non-prosecution agreement, which critics argue is too lenient.

Chinese e-commerce giant Alibaba and its U.S. payment processor allegedly failed to stop dangerous drugs, chemicals, and pill presses from reaching American customers for eight years. Public records indicate that company employees had previously warned about compliance issues, yet the problem persisted.

Prosecutors at the Justice Department reportedly believed they possessed sufficient evidence to prove felony violations of the Food, Drug and Cosmetic Act. This law, enacted in 1938, prohibits the distribution or sale of counterfeit, adulterated, or misbranded drugs, medical devices, food, supplements, and cosmetics.

The investigation, which began during the Trump administration and spanned several years with involvement from multiple agencies, reportedly gathered stronger evidence under the Biden administration. Career prosecutors allegedly urged Justice Department leadership to pursue a deferred prosecution agreement, requiring the companies to admit to felony offenses.

There was egregious conduct by a Chinese-owned company. An NPA is not even a slap on the wrist.

— Source familiar with the caseAn anonymous source familiar with the strength of the evidence criticized the leniency of the settlement.

However, the case was recently settled for $600 million in penalties and forfeitures, accompanied by a non-prosecution agreement. Under this agreement, the companies only admitted to lesser misdemeanor violations. While the Justice Department framed the resolution as a victory, sources familiar with the evidence described the outcome as "beyond disappointing," with one anonymous source stating, "An NPA is not even a slap on the wrist."

This scaled-back settlement with Alibaba is reportedly part of a pattern where corporate cases involving public health and safety under the Food, Drug and Cosmetic Act have seen softened penalties, dismissals, or reduced support from senior Justice Department leaders. Critics argue that this approach, even when investigators believe consumers faced significant risks, undermines accountability for corporate misconduct.

President Trump always talks of being tough on crime, but his administration guts enforcement for corporate law-breakers. In this context, where Americans' health and safety and well-being is on the line, it has real-life ramifications to withhold accountability for corp

— Lisa GilbertLisa Gilbert, co-president of consumer advocacy group Public Citizen, criticized the administration's approach to corporate enforcement.
DistantNews Editorial

Originally published by CBS News in English. Translated, summarized, and contextualized by our editorial team with added local perspective. Read our editorial standards.

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