Judge OKs proposed class-action settlement between Pilot and eight plaintiffs

By Clarissa Kell-Holland, Land Line staff writer | 7/16/2013

A federal judge in Arkansas has approved a preliminary class action settlement between Pilot Flying J and eight trucking companies that have filed lawsuits since news of a fuel rebate scandal broke in mid-April.

The class settlement involves eight plaintiffs negotiating on behalf of thousands of Pilot Flying J customers. The plaintiffs were National Trucking Financial Reclamation Services; Bruce Taylor; Edis Trucking; Jerry Floyd; Mike Campbell; Paul Otto; Townes Trucking; and R&R Transportation. The settlement was reached with the defendants, which include Pilot Corp., Pilot Flying J and James “Jimmy” Haslam III. The settlement received preliminary approval from the court.

According to court documents, more than 4,000 Pilot Flying J customers who purchased diesel fuel for Class 7 and 8 trucks fall into the settlement class if they had fuel rebate or discount programs from 2008 to July 15.

On Tuesday, July 16, U.S. District Court Judge James M. Moody approved the agreement to consolidate and oversee class action claims against Pilot.

“Today in the United States District Court, Western Division of the Eastern District of Arkansas, our attorneys, working together with attorneys for eight of the companies that have filed class action lawsuits against Pilot Flying J, agreed to a plan to pay all customers who join the class 100 percent of the money they are owed, plus 6 percent interest, as soon as possible and without the need for unnecessary time in court, plaintiff legal fees or out-of-pocket costs,” Haslam said in a statement on Tuesday.

“I commend all of these individuals for their hard work and dedication to ensuring our customers are paid back quickly and fairly for any potential discrepancies found in their accounts.”

He added that customers who have already received checks will receive “supplemental checks for any additional interest not included in the original calculation.”

Pilot spokesman Tom Ingram told Land Line on Tuesday that the company isn’t releasing specifics about the financial costs that may be incurred as a result of the proposed settlement.

“But we believe, at the end of the day, the numbers, while significant, will represent a relatively small percentage of the number of PFJ’s more than 4,000 total customers and total revenues involved,” Ingram said.

In a statement, Haslam outlined the terms of the proposed settlement, which include:

  • Auditing accounts of all customers who received a rebate and/or discount from Pilot Flying J from 2008 forward;
  • Paying all customers 100 percent of any monies owed, with 6 percent interest, as soon as discrepancies are verified;
  • Allowing for an independent accountant, approved by the court and paid for by Pilot Flying J, to validate Pilot Flying J’s internal audit process;
  • Offering a right to dispute audit results;
  • Offering customers the opportunity to opt out because they do not like the agreement or because they simply do not want to participate in the class action; and
  • Pilot Flying J will pay all costs related to the process of the customer claims and the litigation, which includes audit costs (both internal and external), administrative costs and legal fees, saving customers significant time and money.

More than 20 lawsuits have been filed against Pilot since the Federal Bureau of Investigation and Internal Revenue Service raided the company’s headquarters in April. At least five employees have pleaded guilty to fraud charges stemming from the alleged fuel rebate scheme.

As of early July, five PFJ employees have pleaded guilty to fraud charges, admitting their involvement in an alleged scheme to manually reduce the rebate amounts trucking company customers were supposed to receive.

“This is an unfortunate time for our customers and our company,” said Haslam, “but we remain committed to making things 100 percent right with our customers, to put systems in place to help ensure this does not happen again, and to re-earn our customers’ trust.”

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