In a major legal victory for Pilot Flying J, a federal judge has dismissed many of the major charges in a civil suit brought by an Alabama trucking firm in the wake of a federal probe of an alleged multimillion-dollar rebate scheme.
In an eight-page ruling issued Friday, U.S. District Judge William H. Steele dismissed eight counts, including racketeering and deceptive trade practices, in a suit filed by Wright Transportation of Mobile, Ala. Defendants in the case include the truck stop chain and some of its top executives, including its chief executive, James A. Haslam, brother of Gov. Bill Haslam.
The judge did let stand some of the charges against some of the defendants, including breach of contract, but he dismissed more than half a dozen. An unjust enrichment charge was dismissed against Pilot Flying J but was left standing for further consideration against the other defendants.
Under the ruling, Steele said that Wright's lawyers could seek to refile some of the dismissed counts by a later amendment.
Aubrey Harwell, Pilot's Nashville attorney, said the judge's decision was "well based in fact and law," adding, "We are delighted."
Stephen Tunstall, Wright's attorney, could not be reached for comment.
The ruling in the case follows the settlement of several other cases in a class-action suit filed against Pilot in Arkansas. That $85 million agreement was approved by U.S. District Judge James A. Moody on Nov. 25.
The Wright suit and dozens of others were filed in state and federal courts across the country after an April 15 FBI raid on Pilot's Knoxville headquarters. Subsequently a 120-page FBI affidavit was filed in U.S. District Court in Knoxville detailing a scheme by top Pilot sales executives to cheat unwitting trucking companies out of promised diesel fuel rebates.
Seven Pilot sales executives have entered guilty pleas to mail and wire fraud charges. They are awaiting sentencing.
Haslam has denied any knowledge of the rebate scheme.
Ark. agreement cited
In the ruling Friday, Steele rejected Wright's claims that it could base a racketeering charge simply by providing a copy of the 120-page FBI affidavit.
"The affidavit does not reference the plaintiff at all," Steele wrote. "The plaintiff cites no authority at all, much less any authority, indicating that the complaint alleges fraud with adequate particularity."
Calling the plaintiff's failure to present adequate evidence of racketeering "complete," Steele said he didn't even need to address any of Pilot's other arguments to dismiss racketeering charges.
However, Steele rejected Pilot's arguments that the breach of contract charges should be dismissed, stating it was "difficult to imagine what could be missing from them."
"The parties agreed to set a discount to be honored by rebate, and Pilot Flying J breached the agreement by rebating less than the fully agreed discount," Steele wrote.
Steele did cite the Arkansas settlement and said its approval made it impossible for Wright to proceed with class-action claims in the Alabama suit.
Contact Walter F. Roche Jr. at (615) 259-8086 firstname.lastname@example.org.