Western Express says in lawsuit alleged Pilot fraud cost them $75 million

| September 04, 2013

pilotMajor truckload carrier Western Express filed last week a lawsuit against Pilot Flying J claiming it was cheated out of millions in Pilot’s alleged fuel rebate withholding scheme and thus incurred a financial shortfall that cost it more than $73 million, according to court documents.

Western Express, based in Nashville and ranked No. 51 in Overdrive sister site CCJ‘s Top 250, says in the suit that it purchased 90 percent of its fuel from Pilot between 2005 and 2013 — about $1 billion worth.

The carrier says it was defrauded out of $2.5 million in withheld fuel rebates, causing it to not meet certain financial parameters required by its creditors and therefore costing them $73.2 million in expenses, fees, legal costs, consulting and more debt, according to the documents.

Western Express says in the suit, which was filed Aug. 29 in Louisiana, that in the fiscal year ending Nov. 30, 2008, it fell short of its earnings target by just less than the amount Pilot had allegedly defrauded from the company.

Federal accusations against Pilot began in April when federal agents raided the company’s Knoxville, Tenn., headquarters April 15. Later that week, a 120-page affidavit was unsealed detailing the allegations and conversations had between Pilot salespeople and FBI informants.

Western Express is mentioned specifically several times in the affidavit as a company targeted by the scheme. In a transcript of a conversation with an FBI informant in the affidavit, Pilot’s VP of Sales John Freeman says in a three-month period in 2008 he cost Pilot about $1 million in withheld fuel rebates and was caught by the carrier.

Freeman ended up buying an airplane from Western Express as part of a deal to square up.

Freeman says in the affidavit Pilot was defrauding the carrier out of $450,00 a month in fuel rebates.

Carriers in class action lawsuits reached a settlement with Pilot in July in an Arkansas court, but members of the class can opt out and sue Pilot individually. Also, as reported last week, questions have been raised about the company heading the lawsuits and whether it was set up to earn a better court deal for Pilot. Click here to see Overdrive‘s coverage.

  • hmmmm

    And the beat goes on, and the beat goes on …

  • http://www.facebook.com/ayrewolfIdaho Patrick Montgomery

    Flying J should have never merged with Pilot

  • MrPresidentCFO

    @ Patrick – I’ve been thinking the same thing. I wonder is they could go to court and void the deal because of this fraud.

  • gary d

    They should refigure that amount a little higher, if they were more profitable they would have hired more drivers put on more accounts. let me do the math for you $1 billion dollars worth of fuel at todays fuel prices that’s 285,714,285 gallons of fuel. if they could have increased profitability by not getting ripped off every year just think of where this company would be today. drivers might actually get a raise oh wait, now all the drivers can sue for the raise they didn’t get can you say back pay for almost 8 years now we are talking billions of dollars lawsuit.

  • Bob

    I’ve been saying for 20 years, Pilot is nothing, but a bunch of overpriced thieves that don’t care one lick for the drivers (especially the O/O) that provide most of their income.

  • Guest

    Pretending to be a FRIEND of the TRUCKER and all the while LYING. PLOTTING, Laying in Wait, and STABBIING the unsuspecting Truckers in the back AFTER cheating him out of his hard earned MONEY. OTHERs are doing this also to the TRUCKER and getting Rich doing it….Brokers, Shippers, Cops/Courts, Dispatchers, Company owners….

  • Guest

    Western Express is such a piece of trash for a company they NEED to be driven completely out of business anyway…they have CSA Alerts of near 100 in UNSAFE DRIVING…going to get other truckers killed…..Near 100/Alert STATUS in Driver Fitness…15 drivers ticketed for NO LICENSE in past 60 DAYS!! Several others for DRIVING on a SUSPENDED LICENSE???? This is a MEGA FLEET!!!! These stupid COPS need to make some ARRESTS down in NASVILLE dont they?????? How many people will have to be SLAUGHTERED by WESTERN EXPRESS before these PAID OFF Cops AUDIT this ANUS company????
    How in the HELL does this company continue to OPERATE????? PAYOLA is the ANSWER and POLITICAL CONNECTIONS…..the COPS are as CROOKED as the Owners of this Murdering DUMP.

  • Guest

    Western Express has had MORE than 20 CRASHES, 6 INJURIES, and KILLED at least 1 person in the LAST 2 MONTHS ALONE!!!!!!!!!!! Maybe Pilot is doing them a FAVOR by driving them OUT of BUSINESS????
    What a SCARY company!!!! They have ALERTS STAUS of near 100 in 2 CATAGORIES(UNSAFE DRIVING and UNFIT DRIVERS)….sound like a CRAZY HOUSE to YOU?????
    20 drivers have been ticketed for either NO LICENSE at ALL or Driving on a SUSPENDED in past 60 DAYS???? This is beyond belief that CSA COPS allow these MANIACS to contnue this MAYHEM…but they will chase you and me all over hell if they see some reflective tape missing ????
    What kind of INSANE police work is THIS????? WHY do they NOT get an ON SIGHT INVESTIGATION and be SHUT DOWN????

  • Guest

    Pilot’s owner Jim Haslam hopefully WILL BE indicted for this Crime against Truckers….he is a crooked SOB and he KNOWS it and his BROTHER the Gov. of Tenn. knows it too……he SHOULD be LOCKED UP……..but his MONEY and Political connections is keeping him out of JAIL so far….if it iwas any of US truckers we would be doing TIME already.

  • Richard Morrison

    Don’t think they can but now that the parent company that owned flying J is doing better financially. They Bought Maverick convenience stores in and around Utah and other states they might get a good deal for the flying J or just open up new stores under the Maverick name. Cost a lot of money to get Flying J back to were it was might just be cheaper to start over and build a new rep.

  • Jon McLaughlin

    Unfortunately, Flying J had no choice. They speculated on fuel prices going up and they went down. They had also built their own refinery and it all hit them at one time. The Mormon Church would not bail them out so Pilot stepped in and RUINED the personality of Flying J.

  • BETTY BOOP

    why would you have reflective tape missing? Not doing your pre-trips? But you want to talk about other people. What a joke!

  • BETTY BOOP

    You sound VERY ANGRY! ANGER MANAGEMENT perhaps?

  • martymarsh

    Yeah but, they probably saved more than that over the years by not paying their drivers.

  • martymarsh

    Do you always have everything you need in your truck, if the reflective tape was missing and you don’t have it do you shut down operations?

  • martymarsh

    They are to big to be shut down. Just because they provide worthless jobs.

  • martymarsh

    So you associate truth with anger. Of course you have to prove he is disgruntled before you put him away, or at least blacklist him. Excuse me, or her.

  • martymarsh

    Stop, your giving me flash backs.

  • BETTY BOOP

    No Marty, you dont need to shut it down. You can buy some reflective tape at a truck stop and fix it, because missing reflective tape is a d.o.t violation.

  • BETTY BOOP

    Hmmm

  • martymarsh

    Oh come on now, you can do better than that.

  • BETTY BOOP

    Ok, Hmmmmmmmmmmmmm

  • martymarsh

    LMAO, much better.

  • BETTY BOOP

    LOL!

  • DUNBEENTHERE

    If WEXP does get
    this money this will be the only thing that will keep them out of hock when their
    bond is due in 2015. Oh wait,,, reality is this will go beyond 2015 so their stand in CEO
    just might have to get a job instead pretending to work.

  • Willa Gilkey

    You don’t know them very well, do you. I do.

  • martymarsh

    Of course you can and of course it is, do you think that everyone is that close to a truck stop that they can absolutely make it without getting caught. Officer I was going to stop at the next truck stop, how many times have they heard that, then after he is handing you the ticket he will say the obvious, hey I would get that fixed at the next truck stop. Been there more than once.
    But you blamed this person for not doing a good PTI and you don’t even know what they would do. You also admitted that you would break the law and go to the nearest truck stop, what if it was 300 miles away?
    There are so many ways to go with this.
    Also you will get a quicker response from me if you actually reply to my comment, because as you know it goes to your email. One never knows I may not come back to this site and I’m sure you wouldn’t want me to depart thinking I had the last word.

  • BETTY BOOP

    Bahahahahahaha. Have a good night buddy.

  • BETTY BOOP

    Hmmmmm. Bahahahahaa!

  • BETTY BOOP

    Bahahahahahahaha`!

  • martymarsh

    You too.

  • martymarsh

    Come on, you can do better than that.