Trucking Giant Agrees to $6.8 MILLION Settlement in Case Alleging Fraud
Nashville, TN — Yellow Corporation has agreed to a multi-million dollar settlement in a lawsuit filed by the U.S. Department of Justice (DOJ) alleging the trucking giant engaged in fraud.
In an announcement last week, Yellow Corp. said it has reached a $6.8 million settlement to end a legal battle with the Department of Defense (DOD) relating to credits for the reweigh of certain freight shipments between 2005 and 2013.
“We are pleased to have come to a resolution,” said Darren Hawkins, CEO of Yellow. “Now we can continue to focus on the important work ahead. With our nation’s current supply chain constraints and the critical role Yellow plays in delivering freight, there’s no time for distraction.”
Specifically, the United States’ lawsuit — filed in 2018 — alleged that Yellow reweighed thousands of shipments and suppressed the results, then indicated that the shipments were actually lighter than their original estimated weight.
Thus, the DOJ alleged that instead of charging the DOD for shipments based on the correct weight, Yellow knowingly billed the government (and their other customers) based on weights that they knew to be inflated.
Yellow also allegedly made false statements to induce the DOD to use them as freight carriers and further knowingly made or used false statements to improperly avoid their obligations to correct inflated invoices and return overpayments.
However, according to the terms of the settlement, Yellow admits no wrongdoing.
“We remain confident that we complied with the then-existing rules and our contractual obligations,” Leah Dawson, Yellow’s executive vice president and general counsel, said this week. “While we believe we had strong defenses, we decided, in the best interests of all parties, to resolve this matter for a small fraction of the amount originally demanded.”
Yellow also noted the allegations “pre-date current management.”