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Burlington Motor Carriers, Inc.

Case Summary

Case Name:

OOIDA, Brian McGrath and Arthur Shaw v. Burlington Motor Carriers, Inc.

Court Name:

U.S. District Court for the Southern District of Indiana

Case Filed:

3/27/2001

Allegations

Violations of the Truth-in-Leasing regulations for undisclosed mark-ups in insurance costs that were passed on to the company’s leased owner-operators.  OOIDA’s complaint alleged that despite Burlington’s agreement and obligation to charge-back premiums for insurance coverage purchased through the company, it was deducting amounts from owner-operator compensation substantially in excess of the actual premiums. 

Burlington filed for Chapter 11 bankruptcy protection a few months after OOIDA filed a lawsuit; however, in 2002, Burlington converted the bankruptcy to a Chapter 7 proceeding and ceased operations.  We filed as proof of claims against the bankruptcy estate; however, there was no money in the estate.  OOIDA, along with three of its members, filed suit against the individual officers of the bankrupt carrier in an attempt to recover the owner-operators’ escrow funds.  The court granted a Motion to Stay until the bankruptcy proceedings were finished. 

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