Nov. 1, 2002, Grain Valley, MO - For the first time, the Owner-Operator Independent Drivers Association (OOIDA) has filed an independent lawsuit against individual officers of a bankrupt carrier in an attempt to recover owner-operators' escrow funds.

On Oct. 31, OOIDA filed a class action in the Hamilton Circuit Court (Hamilton County, IN) against former Burlington Motor Carrier Inc. executives Thomas Grojean, Terry Wallace, W. Andrew Berry, Jeffery Collier and Brian Gast. Joining OOIDA in the suit are three of its owner-operator members, Tom Bays II, Richard Bolduc Jr. and Mark Neff.

Burlington filed for voluntary reorganization under Chapter 11 of the United States Bankruptcy Code on July 9, 2001 only months after OOIDA filed a lawsuit in U.S. District Court in Indiana, claiming violations of the federal truth-in-leasing regulations. OOIDA pursued its original complaints in the bankruptcy court. However, in May 2002 the Daleville, IN, motor carrier converted the bankruptcy to a Chapter 7 proceeding and ceased operations, having used up all funds in its possession, including owner-operators' escrows.

The new suit filed against the Burlington officers alleges that the owner-operators' escrow funds held by the company were never returned to them. Furthermore, it alleges that the escrow funds were used by the company's management to cover the general obligations of the company, including their own compensation, instead of being preserved and returned after termination as required by the federal leasing regulations. In doing so, it is alleged that the officers of the company breached their fiduciary duties as trustees of those escrow funds as well as the fiduciary duties that arise where the corporation is insolvent or operating in the zone of insolvency.

OOIDA has already established in the courts that such escrow funds are held in trust and, accordingly, are not part of the bankruptcy estates of failed carriers. The class action seeks monetary relief in the form of the return of all escrow accounts and interest to all potential members of the class.

"We have said all along that we have no intention of walking away from these types of actions simply because a carrier and its management choose to hide behind bankruptcy," says OOIDA President Jim Johnston. "Where federal leasing regulations have been violated at the expense of owner-operators, we are determined to pursue those companies and, if need be, their individual corporate officers, who engage in this kind of abuse."

He added, "Corporate executives are in a position to have knowledge of, and active involvement in, such unlawful business actions. They would also know before anyone else the financial difficulties that their company is in and therefore cannot continue to recruit owner-operators and collect escrow accounts from those drivers without protecting those funds."