EXCLUSIVE: New Details Emerge About Abrupt and ‘Shocking’ Demise of Dillon Logistics

Burr Ridge, IL – New details are emerging about the final days of a carrier that has been a fixture in the dry and liquid bulk market for four decades.

As reported by Transportation Nation Network (TNN), Dillon Logistics suddenly ceased operations as of midnight on Tuesday, September 1.




 

Management broke the news to employees by conference call earlier that day, TNN has learned.

A Dillon employee who was on that call and does not wish to be named told TNN people were “shocked” despite some warning signs — especially since the pandemic began.

“You always had that little bit of hope,” the employee said.

The company’s approximately 330 truck drivers were notified by email on Tuesday that their jobs had been terminated.

“We are writing to confirm that regrettably your employment with Dillon terminated on August 31, 2021,” Mike Cloonen, president of Dillon Logistics, informed. “The timing of this layoff is caused by business circumstances that were not reasonably foreseeable.”




 

He also provided a brief explanation as to why the 41-year-old carrier was meeting its end.

“The Company had planned to sell the business to another entity under terms pursuant to which the buyer had agreed to maintain the employment of our employees. Unfortunately, that transaction will not be going forward, and we are left with no reasonable alternative other than to liquidate the business.”

Additionally, Cloonen indicated truckers would be paid wages earned through August 31 and “participation in the Company’s benefit plans will terminate in accordance with the terms of the plans.”

“Thank you for your service to the Company,” he concluded.

 

TNN has also learned from a trusted source claiming to have direct knowledge, the final payroll is scheduled to be processed by Friday, September 17.

Private Equity Firm Pulls the Plug 

Dillon Logistics was founded in 1980 by Jeff Dillon and built its success on providing temperature sensitive transportation services to the asphalt industry.

According to its website, the company boasted nine terminals across the U.S. and grew to 450 trucks and 700 trailers.

However, in 2017, Cotton Creek Capital (CCC) — a Texas-based private equity (P/E) firm focusing its investments in companies with enterprise values between $15 million and $200 million — provided an infusion of funding in “support of Dillon’s continued expansion.”

“I am excited for the next phase of Dillon’s growth as we continue to add assets and resources to service our customers,” Mr. Dillon said at the time.




 

CCC has yet to provide TNN with a statement, but multiple sources indicate CCC ultimately decided to pull the plug and begin the liquidation process.

WARN Act Violation?

The Illinois Worker Adjustment Retraining Notification (WARN) Act requires companies that employ at least 75 workers to provide 60-days written notice of mass layoffs.

Certainly that was not done in this case which could lead some to possibly explore litigation in the matter.


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However, Cloonen’s email seems to deflect possible liability on this issue by noting the layoffs were caused by “business circumstances that were not reasonably foreseeable.”

“Please note that the Company does not have a bumping rights system, and that the layoffs, at this point, are intended to be permanent,” the email also states.

Neither CCC or Dillon leadership has made any public statements so far about the specifics which led to the dire financial circumstances.

TransportationNation.com will continue to follow this ongoing story.

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