August 15, 2013

Cedar Creek Trucking sues Pilot Flying J

Rachel Brown
rachelbrown@daltoncitizen.com

— A Dalton-based trucking company whose attorney says it is owed hundreds of thousands of dollars in promised fuel rebates and breached price agreements is suing travel center company Pilot Flying J to get its money back — and then some.

Employees at Cedar Creek Trucking in Dalton referred questions to their attorney, Mark Tate. He said his Savannah-based firm is the only litigant in a class action case against the company that wants Pilot CEO Jimmy Haslam to testify.

Tate said the suit centers on about an 11-month period where Cedar Creek drivers primarily used Pilot centers for fuel, but Pilot didn’t honor the pricing contracts they had agreed to.

About 25 other lawsuits against Pilot have been filed in various venues alleging wrongdoing related to price agreements Pilot didn’t honor, according to news reports. Tate said Cedar Creek’s suit was filed in Knox County Circuit Court in Tennessee a few days ago. Pilot’s main place of business is in Knoxville, which is in Knox County. In addition to gaining punitive damages, the plaintiffs also want to dig into what happened and who was involved, Tate said.

The company recently refused a proposed settlement in which Pilot offered to pay 100 percent of the rebates plus 6 percent interest. U.S. District Judge James Moody in Arkansas gave preliminary approval of the settlement and said the parties have until mid-October to opt out.

Cedar Creek is having no part of it.

While the amount Cedar Creek is owed is still being determined, the figure is certainly six digits, Tate said.

Haslam has not been charged in the alleged scheme and has said he was unaware of any wrongdoing. The suit seeks to depose Haslam and other executives in October. According to The Tennessean newspaper, Pilot spokesman Tom Ingram, one of the individuals set to be deposed, is a well-known lobbyist who is also a consultant to Haslam’s brother, Tennessee Gov. Bill Haslam.

Asked how the company would respond to the suit, a Pilot spokeswoman said in a written statement, “We’ve been advised by counsel that class action lawsuits in a manner like this are expected and no surprise. Our counsel will review them as they come and defend them appropriately.”

Tate said he’s anxious to get to the bottom of the situation and hold Pilot accountable.

“The payment of money that you get caught stealing is only a start,” Tate said. “There’s no business loan anywhere that would allow a 6 percent loan, so they’re entitled to punitive damages.”

Exactly how much is still being worked out.

The case against Pilot is so significant that the travel center company has built a website — rebateeducation.pilotflyingj.com — aimed at responding to questions about it. The legal action follows an FBI inquiry into allegations that Pilot employees schemed to withhold customers’ rebates.

Pilot’s website notes the courts so far “did not decide in favor” of either Pilot or the plaintiffs. “Instead, both sides agreed to settle this case to avoid the cost and risk of trial. The settlement does not mean that any law was broken or that Defendants did anything wrong. Defendants deny all legal claims in this case. The Class Representatives and their lawyers think the settlement is best for all...”

According to Cedar Creek’s website, www.cedarcreektrucking.com, the company is a refrigerated truckload carrier that has offered service “from the southeast to the west and northwest for nearly a decade.”

Justin Jones, a Dalton-based consultant for the firm, said he couldn’t comment directly on the lawsuit but could talk about the company. Started in about 2002 and incorporated some four years later, it grew from about 30 employees to its current roster of about 100, he said. The company is based near the Valley Point schools.

“We’re one of the few companies that weathered the recession,” Jones said.