Saturday, October 29, 2016

Truckers Say Database Key to $4 Billion Scam

By Walter F. Roche Jr.

Two trucking firms have charged that a database maintained by the country's largest truck stop chain is the key to uncovering the full details of a $4 billion rebate cheating scam.
In a 15-page filing in Franklin County Ohio Circuit Court lawyers for the two trucking firms, FST Express and HB Logistics, say that the database, known as SalesForce, is "the pivotal" issue in detailing how Pilot Travel "pulled off the largest fraud ever perpetrated in the trucking industry."
The filing comes after lawyers for Pilot asked the judge presiding over the case to strike from the record a single page from the disputed database. Pilot also wants the judge to block a motion by the trucking firms to force disclosure of the entire database.
The truckers contend that the full scope of the scheme to cheat truckers out of promised diesel fuel rebates has never been known but it dates back a decade.
The suit in Ohio is one of only two remaining civil suits pending since the rebate scheme became public when federal agents raided Pilot's Knoxville, Tenn. headquarters on April 15, 2013. Since that time 10 former Pilot sales staffers have entered guilty pleas to mail and wire fraud charges. Eight more face a 2017 trial on similar charges. They have all entered not guilty pleas.
In the Ohio case the trucking companies have charged that the scheme was even more lucrative for Pilot than charged by federal agents because Pilot inflated the price it actually had paid for the fuel in the first place.
Pilot has countered claiming the trucking firms knew the so-called base price was actually an industry standard.
In the filing this week the two truckers disputed that claim and said that the SalesForce database would prove that point.
"It (the database) will help plaintiffs refute Pilot's absurd suggestion that the amounts it admits it owes are merely the product of account discrepancies and not fraud," the filing states.
"The SalesForce entries tell the who, what, where, when, why and how of Pilot's long running  $4 billion fraud scheme," the filing charges.
The filing also asks the judge to reject Pilot's request to file yet another objection to the records request.
"Pilot is simply trying to have the last word," it concludes.

Friday, October 28, 2016

Stay Granted in Alabama Pilot Suit

By Walter F. Roche Jr.

An Alabama judge has granted a stay to Pilot Travel and it chief executive James A. Haslam in a longstanding suit in which a trucking firm charges it was cheated out of millions of dollars in promised rebates.
The stay halts most proceeding in the case pending the results of a related appeal in federal court.
But the decision by Mobile County Circuit Court Judge Sarah Hicks Stewart does allow lawyers for Wright Trucking to continue discovery, including depositions of key figures including Haslam.
The owner of the Cleveland Browns, has thus far rebuffed efforts to take testimony under oath about his knowledge of the multi-million dollar rebate cheating scheme.
Haslam, however, has repeatedly denied any knowledge of the rebate fraud, but his company already has paid out some $175 million to settle claims from truckers and to settle a complaint filed by the federal government.
The Alabama suit is one of two remaining legal claims against Pilot. The other, filed by two other trucking firms, is pending in a Franklin County Ohio court. In both the Ohio and Alabama cases, lawyers have initiated attempts to force Haslam to testify.
Stewart denied the stay sought by Brian Mosher, another former Pilot sales staffer, because he failed to perfect his appeal and failed to answer the original complaint.
In the ruling this week Stewart gave Mosher additional time to file an answer.
The two pending suits and a now settled class action suit in Arkansas followed a raid on Pilot's Knoxville, Tenn. headquarters by the FBI. An FBI agent later filed an affidavit in federal court detailing a widespread scheme by Pilot sales staffers to cheat truckers out of promised rebates.
While dozens of trucking firms agreed to a settlement, Wright, FST Express and HB Logistics opted out of the settlement and decided to pursue their claims in state courts.
Ten former Pilot sales staffers already have entered guilty pleas to mail and wire fraud charges and another eight have entered not guilty pleas and face trial in Knoxville, Tenn. next year. A recent effort for a change of venue in those cases was denied.