LAWSUIT UPDATE: Allied/North American offer $1.25 million settlement

By Coral Beach, staff writer | 5/2/2008

Friday, May 2, 2008 – After having negotiated an $8 million settlement in the fall of 2007 with truckers in a lawsuit about problems with their owner-operator leases, Allied Van Lines and North American Van Lines filed for bankruptcy in February this year with $5 million still due to be paid.

However, the Owner-Operator Independent Drivers Association had its legal team go to bat for the truckers, and the companies have proposed paying $1.25 million of the balance due. Under the original plan filed with the U.S. Bankruptcy Court the carriers wanted the entire $5 million balance wiped clean.

Lawyers from The Cullen Law Firm in Washington, DC, argued that it would be in the best interests of the reorganized companies to ensure that their owner-operators received as much compensation as possible.

The court must still approve the revised bankruptcy plan, and the timing of payments will be determined at a future date.

Originally filed in May of 2004, the truckers’ case alleged that the carriers’ leases failed to comply with federal truth-in-leasing regulations regarding compensation and chargeback disclosures. As part of the case settlement, Allied and North American were also required to implement a new uniform independent contractor operating agreement.

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