Ohio Judge Declines to Order Haslam Testimony

By Walter F. Roche Jr.

Concluding his intervention was not necessary, an Ohio judge has declined to issue an order to force Cleveland Browns owner James A. Haslam to testify under oath.
In a three-page decision issued this week, Franklin County Judge David C. Young cited Ohio and Tennessee statutes and court rulings that provide a means for two trucking companies to subpoena Haslam for a sworn deposition.
The two companies, FST Express and HB Logistics, are suing Pilot Travel Centers, the Haslam family owned truck stop firm, charging they were cheated out of millions of dollars in promised rebates on diesel fuel purchases.
In requesting Young to issue a commission to subpoena Haslam, lawyers for the truckers acknowledged that they could petition a Tennessee court directly to issue a subpoena.
Shawn J. Organ, one of the lawyers representing the truckers, said Friday they will now go directly to Tennessee courts to schedule the deposition.
Though he heads the nationwide truck stop chain, Haslam has stated repeatedly that he was unaware of a scheme by Pilot sales staffers to cheat truckers out of promised rebates.
The trucking firms, however, contend they need Haslam's testimony because those involved in the scheme, including former President Mark Hazelwood, reported to Haslam.
"Haslam should be able to shed light on how the fraud was conducted, why Pilot did nothing to stop it until the FBI raided Pilot's headquarters on April 15, 2013 and whether Pilot's top executives turned a blind eye to fraud," lawyers for the trucking firms stated in the petition seeking the subpoena.
Hazelwood is under indictment on mail and wire fraud charges along with seven other former Pilot staffers. They all have entered not guilty pleas. The charges stem from a federal probe of Pilot's rebate practices.
Ten other former Pilot sales staffers already have entered guilty pleas to mail and wire fraud charges and await sentencing in U.S. District Court in Knoxville, Tenn.
Citing rulings from the Ohio Supreme Court and Tennessee laws, Young wrote, "Upon review, court involvement is unnecessary in this issue. For the foregoing reasons plaintiff's motion for the deposition of Jimmy A. Haslam 3d is rendered moot."
FST and HB are two of three trucking firms still pursuing civil claims against Pilot. The third case was filed in Mobile, Ala. by Wright Transportation.
The rebate allegations have proven costly for Pilot, the country's largest truck stop chain. Some $175 million has been paid to settle claims filed by other trucking firms and the federal government.
Contact: wfrochejr999@gmail.com

Pilot Wants Judge to Block Record Requests

By Walter F. Roche Jr.

Pilot Flying J is asking an Ohio judge to block two trucking companies from getting access to thousands of internal documents and a computer database with information on the truck stop firm's other customers.
In a 16-page filing in Franklin County Ohio Common Pleas Court, lawyers for Pilot are charging that the 303 pending discovery requests by FST Express and HB Logistics are unduly burdensome and seek information that will ultimately have no bearing on the pending litigation.
HB and FST are two of the three trucking firms still suing Pilot over charges that the Knoxville based firm cheated them out of millions of dollars in promised rebates on diesel fuel purchases.
In the latest filing lawyers for Pilot stated that an audit showed FST is only owed $11,000 and HB actually owes Pilot over $100,000.
The charges against Pilot stem from a federal probe in which a government agent described a wide ranging scheme by Pilot sales staffers to cheat customers out of promised rebates. Pilot already has paid over $150 million to settle claims from truckers and the federal government over the rebate shaving allegations.
In its motion, Pilot noted that the federal agent's affidavit made no mention of FST or HB.
"Plaintiffs seek to recover a windfall by pursuing manufactured claims of cost fraud against Pilot," the motion states.
Pilot said it already has produced 59 gigabytes or 72,889 pages of documents but it is unwilling to provide records relating to some 5,500 other customers over a nearly 10 year period.
According to the motion, a federal judge in a related case already had rejected the truckers requests for the same information.
As for providing access to its internal database, called SalesForce, Pilot said that would require lengthy review to exclude confidential information.
"Plaintiffs cannot seriously suggest that Pilot simply hand over the entire database replete with confidential information and potentially privileged information for thousands of non-party customers spanning nearly a decade without reviewing it," the filing concludes.
The third pending suit against Pilot over rebate allegations is proceeding in an Alabama court.
Ten former Pilot sales staffers have already entered guilty pleas to mail and wire fraud charges stemming from the rebate fraud probe and eight others have been indicted and are awaiting trial. They have all entered not guilty pleas.
Contact: wfrochejr999@gmail.com

Browns Owner Sells Nantucket Property

By Walter F. Roche Jr.

Cleveland Browns owner James A "Jimmy" Haslam has sold his Nantucket vacation home for $6.7 million, more than $3 million less than the original asking price. In fact with the inclusion of an adjacent parcel in the deal, Haslam is getting $6 million less than his original asking price.
Massachusetts land records show the Haslam property was sold to the Jen Sankaty Lighthouse Trust. Michael Altman and Alexandria Stewart Altman are listed as the trustees. The Altmans reside in Bedford Corners, N.Y.
Haslam, the records show, took back a $5.5 million mortgage providing the financing for the transaction. The property is located at 37 Sankaty Head Road.
The deal also includes a second adjacent parcel for which Haslam was seeking an additional $3 million.
Haslam, who also heads the national truck stop chain, Pilot Flying J, first put the property on the sales block for just under $10 million in 2015. He purchased the property in 2006 for $3.85 million.
Real estate advertisements for the ocean front property show it has six bedrooms and a 2 bed room guest house.
Named "Southern Winds," the home was built after Haslam took ownership.
As listed on Sotheby's in early 2015 here is a description  of the property:

"Southern Winds" is a magnificent, Lyman Perry designed, ocean front estate with panoramic views of the Atlantic, Sesachacha Pond, Sankaty Head Lighthouse, Great Point, Nantucket Sound and town in the distance. With gorgeous custom finish work that is perfect in both design and execution, grand rooms that are magnificent in both scale and proportion, beautiful landscape design and breathtaking views from every room, this property - which includes a six bedroom main residence, two-bedroom guest cottage and garage - is a once-in-a lifetime opportunity for the most discriminating buyer.

Truckers Move to Force Haslam Deposition

By Walter F. Roche Jr.

Two trucking firms say they need Jimmy Haslam's sworn testimony to pursue claims they were cheated by the truck stop company Haslam heads and they will pursue it with or without the assistance of an Ohio court.
In an eight-page filing in Franklin County Ohio Common Pleas Court, lawyers for FST Express and HB Logistics said they would even seek to accommodate Haslam by not scheduling his deposition the week after Haslam's Cleveland Browns face the Pittsburgh Steelers.
"To increase the chances of catching Haslam in a good mood, plaintiffs will try to avoid taking the deposition during the week after the Steelers' game," the motion states.
The suit is one of two remaining against Pilot Flying J stemming from a federal investigation and the indictment of 8 top former Pilot sales executives. Ten others have entered guilty pleas. A filing in federal court in Tennessee by a federal agent describes a widespread scheme by Pilot staffers to cheat truckers out of millions of dollars in promised rebates.
The filing this week leaves it to Franklin County Judge David C. Young to decide whether he wants to issue an order to Tennessee court officials to facilitate a Haslam deposition.
"To be clear: it was not and is not essential that plaintiffs present such a request to obtain Haslam's testimony," the filing states, adding that "the court has the discretion to refrain from becoming involved."
According to the filing, a request for a subpoena can be sent directly  to the Tennessee courts.
The truckers dispute claims filed by Pilot Flying J that Haslam's testimony is unneccessary because he knew nothing about the rebate scheme.
"Haslam should be able to shed light on how the fraud was conducted, why Pilot did nothing to stop it until the FBI raided Pilot's headquarters on April 15, 2013 and whether Pilot's top executives turned a blind eye to fraud," the filing states.
Noting that former Pilot President Mark Hazelwood is among those indicted, the filing states that Hazelwood reported directly to Haslam.
Finally the filing notes that despite claims by Pilot's lawyers that Haslam is too busy running the company to be deposed, Haslam has indicated in an Alabama suit that he would be willing to be deposed.
In addition the filing notes Haslam has found the time to attend to the Cleveland Browns and give media interviews about a coaching change and comments at an NFL owners meetings.
"Unless Haslam's announced willingness to provide deposition testimony was merely a publicity stunt to create the appearance of cooperation, it appears Haslam does not share Pilot's concern that a deposition would pose an undue burden," the filing states.
Contact: wfrochejr999@gmail.com

Pilot Flying J Denies Charges in Ohio Suit

By Walter F. Roche Jr.

Pilot Flying J, the nationwide truck stop firm, says that it owes two trucking firms less than $13,500 in rebates and not the millions the companies are demanding in an Ohio civil suit.
In a 45-page response filed this week in Franklin County Court, lawyers for Pilot also denied that company CEO Jimmy Haslam had any knowledge of a scheme by some Pilot sales executives to cheat truckers out of promised rebates.
The long awaited response comes just after Franklin County Judge David C. Young denied a series of dismissal motions filed by Pilot and some of its former sales executives. Plaintiffs in the suit are FST Express and HB Logistics.
In its response Pilot called the charges, including fraud, unjust enrichment and breach of contract "vague and ambiguous. It is therefore difficult for Pilot to respond meaningfully to many of the allegations in the complaint."
Pilot "specifically denies plaintiffs were the victims of fraud," the filing states.
The suit is one of two remaining civil suits stemming from allegations that Pilot routinely cheated truckers out of promised rebates.
Those allegations surfaced following an FBI raid on Pilot's Knoxville headquarters. In a subsequent court filing an FBI agent, quoting from the transcripts of secretly recorded sales meetings, laid out a scheme to target truckers who were less likely to notice billing discrepancies.
Subsequently 10 former Pilot sales staffers entered guilty pleas and await sentencing. 
In the response filed in the Ohio case, Pilot lawyers said HB Logistics and FST Express were not targets of any such scheme.
"Pilot denies that the FBI affidavit specifically refers to plaintiffs," the filing states.
"Pilot further denies that its CEO Jimmy Haslam had any knowledge of any fraudulent actions," it continues.
The filing states that a subsequent audit found that Pilot owed FST less than $11,000 and HB less than $2,500.
"Pilot remains willing and ready to pay any amount owed plaintiffs," the response states.
Pilot is also being sued in a Mobile, Ala. court on similar allegations brought by Wright Transportation. It previously settled a class action case in Arkansas for $83 million. A $92 million settlement was reached with the federal government.
Contact: wfrochejr999@gmail.com

Default Judgment Issued Against Ex-Pilot Sales Exec

By Walter F. Roche Jr.


An Alabama judge has issued a default judgment against a former Pilot Flying J sales executive in a civil suit against the truck stop chain and its top executives.
A Mobile County Judge Sarah Hicks Stewart today issued the judgment against Brian Mosher, the former national director of sales for Pilot. Mosher already has entered a guilty plea in federal court to charges of conspiracy to commit mail and wire fraud. He is awaiting sentencing.
The ruling was issued in a suit filed by Wright Transportation, an Alabama trucking firm, that has charged that Pilot and certain of its executives, including CEO James A. Haslam, cheated the company out  of millions of dollars in promised diesel fuel  rebates.
The default judgment had been requested by Wright's attorney, Stephen M. Tunstall, who had charged that Mosher had falsely claimed that he was being forced to defend himself in two separate courts for the same charges.
Tunstall charged that Mosher, despite a court order, refused to file a response to the Alabama court action.
"Having failed to answer Wright's complaint, which has been pending for more than eight months, Defendant Mosher is in default," the Wright motion stated.
The Alabama suit is one of two remaining civil actions stemming from a highly publicized fuel rebate scandal. Charges that the company routinely cheated truckers out of promised rebates first surfaced after an FBI raid on the truck stop chain's Knoxville, Tenn. headquarters.
The other remaining suit is pending in Ohio and last week a Franklin County judge denied dismissal motions, which could clear the way for Haslam, owner of the Cleveland Browns, to be forced to testify for the first time about the rebate scandal.
Haslam has not been charged and has repeatedly denied he had any knowledge of the scheme. His deposition is also being sought in the Alabama case.

Ohio Judge Denies Pilot Motions to Dismiss

By Walter F. Roche Jr.

A Franklin County Ohio judge has flatly denied a series of dismissal motions filled in behalf of Pilot Flying J in a suit charging the Tennessee based firm with cheating two trucking firms out of promised rebates.
In a 17-page decision issued today Judge David C. Young said the trucking firms, FST Express and HB Logistics, had presented sufficient evidence to pursue claims that Pilot and two of its former executives engaged in charges ranging from fraudulent inducement to breach of contract and violations of state consumer protection laws.
The decision also denied dismissal motions filed in behalf of former Pilot executives John Spiewak and Arnold Ralenkotter.  Spiewak has entered not guilty pleas to mail and wire fraud charges. Ralenkotter has pleaded guilty and is awaiting sentencing on a charge of conspiracy to commit mail and wire fraud.
Charges against both stem from a federal grand jury probe into allegations that Pilot cheated truckers out of millions of dollars of promised diesel fuel rebates.
Young's ruling is the latest development in remaining civil suits brought against the Knoxville, Tenn. based truck stop giant.
Young's ruling is likely to lead to renewed efforts to depose Pilot's top executive James A. Haslam, who has repeatedly denied any knowledge of the scheme by Pilot sales executives to cheat unsuspecting truckers out of promised rebates.
Haslam, also the owner of the Cleveland Browns, at first resisted efforts to depose him but later said he would agree to questioning if a series of conditions were first met. His testimony is also being sought in a suit pending in Alabama.
"The court finds that the cause of action for fraudulent inducement is properly brought by plaintiffs," Young wrote.
The judge did strike limited language from a section of the complaint alleging unjust enrichment, but all other charges now go forward.
"The court finds that FST has sufficiently alleged a claim of breech of contract," the ruling states, "adding "FST has alleged actual and consequential damages as a result of Pilot's breech."
The ongoing civil litigation stems from charges in federal court documents, that Pilot sales executives routinely cheated truckers out of promised rebates. Subsequently 10 former Pilot sales staffers have entered guilty please to charges including mail and wire fraud.
Pilot also has paid some $175 million to settle related claims from other truckers and the federal government.