The founder of an Arkansas trucking group that has sued Pilot and is now settling with the fuel giant has denied his organization is a "shell company."
Last week 10News reported on court documents that allege Pilot Flying J could be tied to a shell company in Arkansas. The implication was that the company was possibly created to sue Pilot so it could then play a role in settling lawsuits.
Lane Kidd, the founder of National Trucking Financial Reclamation Services LLC, wrote to 10News with a three page explanation of the unorthodox timeline of his company's role in the Pilot lawsuit and class action settlement.
The timeline starts April 15 when the FBI raided Pilot Flying J headquarters. On April 18, the FBI released the affidavit that accuses Pilot of a rebate rip-off scheme. Then on April 22, Arkansas Trucking Association (ATA) president Lane Kidd filed paperwork to form National Trucking, registered at the same address as the ATA in Little Rock. On April 24, the two-day-old company National Trucking sued Pilot for rebate fraud. On July 16 a judge in Arkansas gave preliminary approval to a class action settlement between Pilot Flying J, National Trucking, and seven other plaintiffs that had filed federal lawsuits.
"National Trucking could not have bought fuel prior to the raid because they were not even in existence," said Drew McElroy, a Knoxville attorney who represents five trucking companies that are opting out of the proposed settlement. "Who is this company?"
McElroy questioned the appropriateness of National Trucking's lawsuit based on the existing relationship between Pilot Flying J and the Arkansas Trucking Association. The ATA's annual convention lists Pilot Flying J as one of its "gold level" donors.
"It's nothing more than a shell created for the purposes of this lawsuit. You tell me what they do," said McElroy.
Last week, Lane Kidd declined to comment on the allegations. Now Kidd has responded by sending a statement to 10News that explains National Trucking was, in fact, formed entirely for the purpose of suing Pilot Flying J. However, Kidd flatly denies being an insider Pilot planted to negotiate a sweet settlement deal.
"At no time prior to filing the lawsuit, did Pilot know of my intentions to file the case," wrote Kidd. "I have never met Mr. Jimmy Haslam and do not personally know him."
Kidd writes that he created National Trucking as an "assignment company" that would sue on behalf of other trucking companies who want to remain confidential in the early stages of litigation.
"Most trucking company owners are reluctant to file lawsuits and they are typically not litigious. In the matter of allegations that Pilot Flying J had underpaid trucking company owners, many executives were interested in recovering any money owed them, but they were reluctant to be publicly involved. Also, there were other members of the Arkansas Trucking Association who were reluctant to be involved, as they believed the allegations in the FBI affidavit might not be true," wrote Kidd.
Kidd continued by saying he created National Trucking as an organization which "could serve as the plaintiff and which could represent and help the trucking companies who sought justice."
"National Trucking was not formed to resolve or settle this matter with Pilot and the other defendants. It was formed to seek justice," wrote Kidd.
Lincoln Memorial University law professor Matthew Lyon says it is not necessarily an everyday thing for companies to assigning their rights to a different company to sue. However, he says it is not entirely uncommon.
"Especially in contract rights [cases]. Rights can be freely assigned. Then the right to recover for breach of contract, which is essentially what happened here, can be assigned," said Lyon.
Lyon says National Trucking may have to identify which companies it represents when the settlement agreement is reviewed at a fairness hearing November 25 in Arkansas.
"It has to be a valid assignment, so let's look exactly what was the assignment, what was assigned, how was it assigned, did you get anything in return for the assignment, that sort of thing," said Lyon.
Kidd declined an on-camera interview with 10News, saying he would stick to his written statement until the conclusion of the fairness hearing November 25. Until then, Kidd says he just wants to "let the system work."
Reporter's note: Attached to this article is a PDF of Lane Kidd's three-page statement regarding the creation of National Trucking Financial Reclamation Services for the purpose of suing Pilot Flying J.