Attorneys for OOIDA are turning up the heat in a legal battle that involves hundreds of truckers, $5 million and relief supplies that the state of Florida contracted for in the wake of Hurricane Katrina.
This week, the Association put Florida officials on notice that it would file a separate case against the state if officials there do not take action to ensure that truckers receive payment as called for in their contracts to haul water and ice to hurricane victims.
In a letter to the Florida Agriculture Department, OOIDA's general counsel, Paul Cullen Sr., asked Florida officials to either withhold the state's payment to Lipsey Mountain Spring Water until a lawsuit against the company is resolved, or deposit the amount due with the federal court pending the resolution of the truckers' claims.
"If the state of Florida pays Lipsey Mountain Spring Water after having received notice of the adverse claims of these small-business truckers, it will risk having to pay for these transportation services twice," Cullen wrote on behalf of the Owner-Operator Independent Drivers Association.
"We are fully prepared to proceed against the state of Florida in state court to recover the sums identified . for the services of drivers and their equipment."
As of midday Nov. 16, Cullen said Florida officials had not responded to the letter.
At issue is an estimated $5 million that is due to several hundred truckers who signed contracts to haul bottled water and ice for victims of Hurricane Katrina.
The Florida Department of Agriculture and Consumer Services contracted with Lipsey, a Louisiana company with offices in Norcross, GA, for 500 to 1,000 truckloads of water and 25 million pounds of ice. The contract called for Florida to pay Lipsey $1,600 for the water trucks and $2,003 for the ice trucks per truck, per day for the use of the transportation equipment and layover time.
Lipsey then entered into an agreement with 4 Points Logistics, a Delaware transportation broker with its headquarters in Leesburg, FL, to secure the transportation of the ice and water. 4 Points contracted truckers to haul the ice and water, with the contracts including detention pay of $60 per hour, per truck, with no time limitations.
However, according to a lawsuit filed in federal court by OOIDA on behalf of the truckers, 4 Points reneged on the amount of detention pay.
According to the lawsuit, truckers picked up their loads and then waited an average of 10 days or more at a staging area in Mississippi before making final deliveries of the "emergency" supplies to Florida. Then the broker informed them that they would only be paid detention pay for 10 hours a day.
4 Points, whose principal shareholders include Scott Moscrip - who truckers may be familiar with as the owner of Internet Truckstop - then started sending out checks with special endorsement lines.
The endorsement states if truckers cash the checks, they are agreeing they have been paid in full. And it doesn't do any good to cross out the endorsement before cashing the checks.
"You can't just scratch that out," said OOIDA's attorney. "The check has been tendered to you with the endorsement . it would be like changing the amount of the check."
Cullen said he and other lawyers on OOIDA's legal team tried to negotiate with 4 Points Logistics to get the company to remove the special endorsements from its checks, but those negotiations are at a standstill. A hearing is set for Dec. 6 in federal court on the matter.
OOIDA's lawsuit, filed Oct. 26, in U.S. District Court in central Florida, names Icehouse Cartage Express Inc. of Hamilton, MO; Grain Express Inc. of Emporia, KS; and Northstar Express Inc. of Middletown, NY, as three of the small-business truckers who have not been paid the contracted amount.
The Association asked the court to declare the case a class action and include all truckers who were involved in the contracts.
OOIDA President and CEO Jim Johnston said the situation is resulting in huge, unjustified and undeserved profits for the middleman with the truckers getting skinned.
"What 4 Points and Lipsey have done can be categorized as rank profiteering," said Johnston. "Together, they have seized this unfortunate opportunity to make as much money as they can from the efforts of others without any thought about the impact their opportunism will have on future disaster relief efforts."
OOIDA General Counsel Cullen addressed that very point in his letter to the Florida officials.
"Florida has an overriding interest in making sure that resources remain available to the state in emergency situations .," Cullen wrote.
"A substantial number of the drivers being victimized by 4 Points and Lipsey Water were given the opportunity to transport emergency supplies after Hurricane Wilma hit Florida. Many of those drivers refused to participate in the Wilma effort because of their experience in the Katrina emergency."
Drivers having similar problems with other brokers may contact Nancy Baker at OOIDA by calling 1-800-444-5791.