Both sides claim a win.

tec1959

Expert Expediter
Landstar System Inc. may charge more than it pays for products and services it buys on behalf of the independent truck drivers whose equipment Landstar leases, a federal judge has ruled. But to do so, it must provide access to documents used in determining the validity of such charges, which Landstar deducts from the amount it pays owner-operators.

The layered court ruling was issued Oct. 6 by District Judge Henry Adams in the Middle District of Florida in response to competing motions in a class-action lawsuit against the Jacksonville-based trucking company.
The Owner-Operator Independent Drivers Association Inc. sued Landstar in November 2004, alleging the company violated Truth-in-Lending provisions of the Motor Carrier Act. OOIDA, which sued on behalf of more than 27,000 truck drivers, argues that Landstar owes more than $42 million.

Both sides have issued statements claiming Adams' ruling as victories.

OOIDA President Jim Johnston said he is pleased with the finding that Landstar must provide documents needed to verify the validity of certain charge-backs and that the company has failed to do so.

"While the court chose to disagree with some points in our original complaint, we are satisfied that the core items of disclosure of all charge-backs and strict compliance to the regulations were affirmed," Johnston said. "The days of secret, undocumented profits are coming to an end following these rulings."

Landstar officials said a review of the underlying documents will verify that all charge-backs to its contracted drivers, which it refers to as business capacity owners, were done correctly.

Landstar Chief Financial Officer Bob LaRose said Adams' ruling will allow the company to continue providing and developing cost-saving programs to help BCOs minimize expenses. "All our BCOs need to do is look at the pricing, compare and decide for themselves whether or not to participate in any of these programs."

Another point won by Landstar was that the company has complied with the requirement to specify items that it may pay for and then deduct from drivers' revenues. The case is expected to be tried in 2007.
 
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