It’s been a long and painful process for the nearly 1,400 former truck drivers and employees of Tulsa-based Arrow Trucking, who found themselves without jobs and paychecks when the company abruptly collapsed a few days before Christmas in 2009.
The lingering question they have now is whether they will ever recoup back wages and other money owed them by Arrow Trucking. Several hundred drivers were stranded all over the country, some under loads and without fuel, when they received the Qualcomm message the company was ceasing operations on Dec. 22, 2009.
Patrick J. Malloy III, bankruptcy trustee in the U.S. Bankruptcy Court for the Northern District of Oklahoma, is charged with uncovering Arrow Trucking’s assets and liabilities. He told Land Line Now on Tuesday, March 23, that he is hopeful there will be enough money left over to pay employees more than $700,000 in wage claims.
He added that his objective “is to bring in enough money to pay these wage claims at least.”
Malloy has spent the past few months sifting through the company’s incomplete financial records after he was appointed trustee in the case. Arrow Trucking filed for Chapter 7 bankruptcy liquidation on Jan. 8, 2010.
Unusual in the case, according to Malloy, is that Arrow Trucking’s financial records are virtually nonexistent.
“Well, what’s unusual about this case is that when companies, particularly companies of this size, file bankruptcy there’s schedules of assets and liabilities and statement of financial affairs (usually) prepared well in advance and they are part of the filing,” he said.
However, Malloy said that wasn’t the case with Arrow Trucking, which reported $218 million in revenue in 2008.
“Here, they didn’t do any of that, so we had no idea,” he said. “We had to hire accounting firms to go in and basically reconstruct their financial picture.”
Arrow Trucking’s bankruptcy petition listed its assets and liabilities as both being between $100 million and $500 million. According to the schedules of assets and liabilities Malloy filed with the court in mid-March, the company’s liabilities are approximately $98.97 million and its assets are only around $8.55 million.
“I thought the liabilities would be between $50 million and $100 million, and most of the truck assets were either subject to prior security interests or owned by other entities,” he said. “The real value here lies in real estate that’s owned by sister companies, and we can’t realize on that unless or until we consolidate those companies into the bankruptcy cases.”
Malloy said he has filed a motion to consolidate Arrow Truck Real Estate, which maintained the commercial property on which the debtor operated, along with Megan Corp., which owns property in Colorado, and Arrow Truck Leasing, which he said had seven vehicles that “were free and clear and were sold at a public auction” about a week ago.
Malloy said that former employees’ wage claims will be given priority over Arrow Trucking’s former bank, Transportation Alliance Bank, which has brought a $12.5 million lawsuit against the now defunct trucking company, alleging fraud charges.
– By Clarissa Kell-Holland, staff writer
– Staff Writer Reed Black contributed to this report.