Trucking Industry

5 of 8 Suspects Plead Guilty to Staged Truck Crashes

March 24, 2020 by Levinson and Stefani Leave a Comment

Five out of eight defendants in an investigation regarding staged truck accidents in New Orleans–which brought fraudulent lawsuits–pleaded guilty in late January, an act which brought further scrutiny upon the remaining defendants awaiting their trials.

Those three, including the alleged ringleader, were all involved in the money fraud scheme, but were not part of the plea bargains. However, one passed away in 2019.

Of this group, two drivers and three passengers in two separate accidents involving 18-wheelers plead guilty before US. District Judge Eldon Fallon to both conspiracy and wire fraud.

In the plea agreements filed in the U.S. court in the Eastern District of New Orleans, four of the defendants confessed–Lucinda Thomas, 63; Mary Wade, 55; Judy Williams, 59; and Dashontae Young, 25, all from Houma. These four left Houma and ended up in an accident in June 2017 near the Danziger Bridge.

Larry Williams, 46, a fifth defendant from New Orleans, admitted he was also a part of a staged accident six days later with a truck in the same area.

Additionally, another two individuals named in the indictment–Damian Lebeaud and Mario Soloman–are currently under federal investigation for their involvement. Two attorneys are also under investigation, according to court documents.

Labeaud was described by federal investigators as conspiring directly with “Attorney A” before and after the fraudulent accidents. Both incidents in the indictment were followed by lawsuits filed by attorney Daniel Patrick Keating.

Group members filed lawsuits after the stagings occured in order to “defraud and obtain money and property from insurance and trucking companies.” Some were seeking up to $1 million in damages.

A local news station’s investigative series dubbed “Highway Robbery” found that Attorney A is in fact Keating–based on his phone number being the one cited in court filings and by federal authorities as the one Labeaud would call regarding the accidents.

“Attorney A and Labeaud met at a restaurant in New Orleans,” said the U.S. Attorney’s Office. “During their meeting, Attorney A and Labeaud agreed that Attorney A would pay Labeaud $1,000 per passenger for staged and legitimate accidents with tractor-trailers.”

In addition, the indictment showed that Thomas had undergone neck surgery because “Attorney A” said she “would get more money through the lawsuit if she had the surgery.”

In the pleas filed on January 30th in federal court, the first staged incident is cited as occurring on June 6th, 2017, followed by a second on June 12, 2017. Both accidents took place in New Orleans, and some of the scammers said they were treated by doctors “known to the grand jury at the direction of one of the attorneys.”

According to the plea agreements, those pleading guilty faced a $250,000 fine and up to five years in prison.

Covenant Transportation Group had a truck involved in one of the staged accidents. The group’s representation apparently spent months investigating the fraudulent incident, scouring cell phone and cell tower records, analyzing dash cam and police body cam videos, and researching other documents that they ended up releasing to the FBI.

Over three months, the transport company’s team worked to find substantial evidence, eventually gathering enough to file documents in the civil suits claiming fraudulent activity.

This isn’t the only incident of its kind, either. Throughout 2019, New Orleans trucking fleets were warned about multiple suspicious incidents taking place after a notable “fake accident” lawsuit against Whitestone Transportation out of Mississippi.

In a series of at least 30 different suspicious accident cases, many similarities have been noticed. Almost all of these staged accidents take place around New Orleans, include multiple passengers in a claimant vehicle, involve sideswipe allegations against commercial vehicle trailers, have minimal damage to the claimant vehicle, have little or no damage to the trailer, and involve a commercial vehicle driver who either denies the crash or is unaware of it.

Regarding the most recent indictment, the U.S. Attorney’s office wrote in a press release: “Attorney A knew Labeaud was staging an accident and Attorney A paid Labeaud for at least 40 illegally staged automobile accidents. In addition, Labeaud and Attorney A would discuss the staging of accidents before they happened.”

Navistar Engine Lawsuit Approved at $135M

March 23, 2020 by Levinson and Stefani Leave a Comment

CHICAGO – A $135 million settlement will now be paid to resolve claims that Navistar sold defective truck engines knowingly.

A federal judge in the city granted final approval of the settlement last month between Navistar Inc. and a court-certified class of around 45,000 plaintiffs.

This settlement benefits truck drivers, particularly, who leased or purchased a MaxxForce 11- or 13-liter engine-equipped vehicle from between the 2011 and 2014 model years. These engines were certified to meet EPA 2010 emissions standards without selective catalytic reduction technology.

This settlement has been one of the the most prominent legal battles for Navistar, a company that builds international trucks. The issue originates from the leasing and sale of over 66,000 trucks with engines equipped with defective exhaust gas recirculation (EGR) systems–which are meant to control nitrogen oxide emissions.

Allegedly, the defect causes engines to heat up much more than similarly-made engines, which leads them to break down more easily.

The plaintiffs claimed that they would not have purchased the vehicles, or would have paid much less, should they have known about the potential defects ahead of time. Because of this, Class Members, along with the plaintiffs, argued that they had sustained financial injury.

When the settlement was made in May of 2019, U.S. District Court Judge Joan Gottschall rules that it was “fair, reasonable, and adequate.”

Lyndi MacMillan, director of business communications for Navistar, said the company looks at the settlement as a way to move forward. “Navistar is pleased with the court’s decision to approve the proposed $135 million class action settlement,” she said. “The settlement is a major step in helping us move past the MaxxForce 1-liter and 13-liter EGR engines issues in the U.S.”

According to the settlement, class members are able to select a “no questions asked” payment of up to $2,500 per truck, a $10,000 rebate off of the price of a new truck, or out-of-pocket costs per truck related to the EGR setup of up to $15,000 total. The agreement has set aside $85 million in cash with another $50 million for the rebate program.

Class Members must file a valid claim by May 11, 2020 to benefit from the settlement.

Who is eligible?

Any consumer who purchased or leased a 2011 to 2014 model year vehicle which used a MaxxForce 11- or 13-liter engine with specific certification meeting EPA 2010 emission standards without selective catalytic reduction tech can benefit from the settlement.

To see if their vehicle qualifies, consumers can check their VIN numbers.

What is the award?

Consumers can receive up to $2,500 in cash or up to $10,000 in rebates per affected vehicle. Additionally, Class Members will get a certain monetary amount for each month that they owned or leased the affected vehicle.

Limitations for the cash option:

-Model year 2011: $26.59 per month

-Model year 2012: $29.07 per month

-Model year 2013: $33.33 per month

-Model year 2014: $39.06 per month

Limitations for the rebate option:

-Model year 2011: $106.36 per month

-Model year 2012: $116.28 per month

-Model year 2013: $133.32 per month

-Model year 2014: $156.24 per month

There is an additional third option from which Class Members may be able to benefit if they choose to forego cash or rebates. The “Prove-Up” option allows Class Members to collect up to $15,000 in covered costs per vehicle owned or leased. These costs include repairing or replacing primary components, or repairing or replacing a secondary component that takes place within 30 days of the first.

The primary components include: the EGR Cooler and the EGR Valve. Secondary components include: the Lambda Sensor, Oxygen Sensor, Oil Centrifuge, Valve/Seat (Intake), Valve/Seat (exhaust). Valve Bridge, Cylinder Head (when accompanied by a Valve/Seat (Intake) and Valve Bridge repair), Turbochargers, Total Engine Replacement or Rebuild (with proven Turbochargers failure), Diesel Particulate Filter, and DOC/Pre-DOC.

In their court filings, the plaintiffs claimed that heavy-duty diesel engine manufacturers have worked to lower NOx emissions with EGR for years, and that all manufacturers, apart from Navistar, adopted selective catalytic reduction (SCR) to remove NOx from the exhaust after federal emission standards were lowered in 2010.

According to the court documents, Navistar tried to use EGR alone to comply with the rules, but MaxxForce engines prevented the setup to function properly. Since then, Navistar has implemented a new series of SCR-equipped engines.

American Intermodal Management Merges with FlexiVan, Becomes Leader in Marine Chassis Leasing

March 16, 2020 by Levinson and Stefani Leave a Comment

MIAMI – U.S.-based marine chassis lessor, American Intermodal Management (AIM), along with portfolio company I Squared Capital, is now merging with FlexiVan Leasing, as announced January 27th. FlexiVan is owned by Castle & Cooke and is the third largest marine chassis provider in the country, with its 300 employees and over 120,000 chassis.

“I Squared Capital is expanding its global presence across the transportation and logistics value chain with approximately $2.2 billion of equity capital committed across North America, Europe, and Asia,” said AIM Board chairman and I Squared Capital Managing Partner, Adil Rahmathulla. “We are now a leader in trailer and chassis leasing across Europe, Canada, and the U.S. as well as the largest private owner of highways in India.”

AIM currently operates 12,500 chassis, and will reach a combined fleet of 137,500 with FlexiVan.

“This transaction combines FlexiVan’s 65 years of operating history, nationwide presence, and deep customer relationships with AIM’s fleet of new chassis, innovative technology. and data analytics to offer our customers more flexibility and great supply chain efficiency,” said AIM CEO and CEO of the new combined company, Ronald Widdows.

The business will continue to be called FlexiVan, a name originating from the mid-1950s when trucking executive Malcolm McLean helped to develop the first standardized intermodal shipping container.

As for AIM, the company was formed by I Squared in 2016 as a logistics platform, and has become a leading chassis lessor. AIM provides GPS-enabled services to other companies, shipping lines, and retailers throughout the country’s intermodal supply chain, and currently has the innovative technology options to work with FlexiVan’s relationships and deploy its tech-enabled model throughout the U.S.

“This is our fifth acquisition in the transport and logistics sector in the last six months, and [is] a key milestone as we expand our presence in the U.S. market,” explained Rahmathulla.

AIM is a young business and has many of the highly sought-after technologies trucking companies are searching for lately–such as LED brake lights, automatic braking systems, and radial tires. Each AIM chassis has a GPS sensor, an accelerometer that transits distance, speed, and direction, and a load sensor that can communicate when a container is mounted and dismounted.

As FlexiVan acquires AIM’s chassis fleet, it will no longer need to purchase thousands of new chassis from China International Marine Containers, the industry’s leading manufacturer. Importing from the overseas company brought up the issue of tariffs–which will no longer be an issue for FlexiVan, as its chassis from AIM will last for up to 25 years.

Additionally, until this announcement, AIM had been shut out of multiple terminals because it had not established relationships with ocean carriers and terminal operators–which control which chassis are used. Now, it should be welcomed at most ports.

“AIM as an upstart–they didn’t have any of those legacy relationships or contracts, and they were being essentially left out of some business,” said director of transportation consulting with IHS Markit, Paul Bingham. “That’s because their equipment wasn’t able to be used at some specific terminals. This deal breaks down the walls, at least for AIM getting onto the terminals where the acquired company has operations now, so it expands where their fleet can reach, and the merged company will have more opportunities.”

FlexiVan currently works with all major chassis pools, and has current agreements with many large container shipping companies, like OOCL and Ocean Network Express.

“The combination of AIM and FlexiVan will provide strong financial support to continue the upgrade of FlexiVan’s fleet, support significant investment in new assets, and fund ongoing development of innovative IT systems, all of which will allow us to deliver an industry-leading customer experience,” said Charlie Wellins, FlexiVan president.

However, Bingham said it is not guaranteed chassis customers will see an immediate significant change.

“I really don’t know if it is going to fundamentally revolutionize anything, because it’s still not moving the industry to where it’s the actual truckers owning the chassis, like it is in the rest of the world,” he explained. “The issues revolve, as they always have, around maintenance…This particular merger is a change of some of the leadership, but I’m not sure where it’s going to go in terms of management.”

$8 Million Granted in Roadway Safety Efforts, Including ND’s Autonomous Crash Truck

March 15, 2020 by Levinson and Stefani Leave a Comment

Commuters are already moving about before dawn on the streets of Washington DC United States Capital City

The state departments of transportation and local governments of 10 different states are receiving part of the Federal Highway Administration’s $8 million in grants for Accelerated Innovation Deployment or AID demonstration programs, as announced January 21st.

These grants will work to accelerate the implementation of new transportation technology, improve traffic management, speed up completion times for bridge projects, and improve overall roadway safety in Alabama, Arkansas, Colorado, Florida, Illinois, Iowa, Michigan, Minnesota, New York, and North Dakota.

“These funds will help support our state and local partners across the country in their efforts to deliver more resilient roads, bridges, and highways for the traveling public,” said FHWA administrator, Nicole Nason.

One of these efforts is that of North Dakota, which received $241,687 for its autonomous crash attenuator truck.

A crash attenuator itself is a tool used to lessen crash impact, and is often installed at the end of a guardrail. An attenuator truck, or a “crash truck,” is typically positioned at the ends of work zones to help protect workers from collisions.

“[The attenuator] dampens or deflects that vehicle that’s coming into the work zone,” NDDOT engineer Travis Lutman said. “This is a big box, essentially, that is meant to deflect or absorb the impact of a crash so it doesn’t enter the work zone and hurt anybody.”

As of now, NDDOT uses an attenuator-mounted truck which must be operated by a driver. According to Lutman, the FHWA will be used for new autonomous vehicle tech in order to create a system allowing a driver-operated lead vehicle to communicate easily with an autonomous follower vehicle.

This attenuator-equipped follower vehicle would not need a driver in a work zone, but a human operator would need to aid in transporting the vehicle to and from the zone itself. Lutman said the autonomous attenuator truck would be useful in tasks like crack sealing, lane striping, and bridge cleaning.

The overarching goal of this new system is to increase safety around work zones, especially for the operator of current crash trucks.

“We want to get him or her out of that vehicle, creating a safe work environment for them,” said Lutman.

He also explained that Fargo will be the first city to implement the technology as efforts move forward between North Dakota and Minnesota.

Additionally, in Florida, the Florida Department of Transportation and the City of Orlando are using their joint $1 million AID grant for a segment of a larger project aiming to better manage traffic flows around downtown Orlando–which will specifically seek to improve “traffic signalization” at roadway intersections throughout the downtown area.

In New York, the state Department of Transportation will work to improve traffic incident management with its $740,000.

With $1 million, the Alabama Department of Transportation and Baldwin County will accelerate bridge construction and next beam ultra-high-performance concrete retrofit in an effort to shorten construction time from 14 weeks to six weeks.

Arkansas will use $313,600 for 3D modeling and paperless construction to enhance Global Navigation Satellite System technology throughout engineering and construction project phases.

Colorado’s DOT will use its $800,000 for Snowplow Signal Priority, allowing prioritized treatment for snowplows at traffic lights in order to help traffic flow more easily during snow removal.

In Iowa, the DOT and the city of Dubuque will develop a next-generation traffic control system in order to link 11 different corridors and act as one large integrated system. The state was given nearly $1 million for the project.

The Minnesota DOT will use another $1 million to improve safety and access along Broadway Avenue in Winona. In Michigan, the Department of Transportation will use $1 million to accelerate bridge construction and employ Prefabricated Bridge Elements and Systems (PBES) to decrease traffic delays, currently caused by the construction of its 2nd Avenue Network Arch Superstructure project.

The Illinois Department of Transportation will also use $1 million to implement compacted concrete pavement to improve the surface of Jerseyville’s Hollow Avenue. This concrete differs from standard roller compacted concrete with its high-density asphalt-type paver instead of standard paving. Compacted concrete pavement has a similar surface finish to standard pavement, but will use a tamper screed on its high-density paver. This will compact the road’s surface without the need for roller compaction.

“The grants being awarded today will help advance innovative transportation solutions to improve safety and mobility on America’s roadways,” said FHWA’s Nason.

As Technology Advances, Disruptions Could be Detrimental for Fleets

February 29, 2020 by Levinson and Stefani Leave a Comment

Digital Truck. The concept of digital technology in the delivery industry. 3D Illustration

After last year’s GPS rollover on April 6th, the extent to which many carriers lean on technology became evident. The GPS update event, which takes place around every 20 years, brought to light the trucking industry’s possibility of experiencing widespread tech malfunctions–and the large problems those can easily cause for businesses.

The update connects to the system’s 10-digit format. Once it runs out of 10 binary digits, it must undergo a large-scale update.

“We don’t hear many questions from fleets that we work with on the concern of a network-wide outage,” said Deryk Powell, president of Velociti. “The GPS rollover event heightened the awareness of that for some fleets–it’s absolutely a concern.”

Smaller tech interruptions can be just as disruptive.

“Systems go down occasionally,” said founder of C.J. Driscoll & Associations, Clem Driscoll. “A particular telematics provider may have its servers go down. It doesn’t happen often..but it does happen from time to time. That can be an issue.”

Geotab commercial vehicle solutions vice president Scott Sutarik agrees. He said technology progression is vital in regards to safety improvement, even at the risk of systems going down. This is true, he explained, across all tech use–from electronic logging device compliance, safety camera systems, and radio frequency identification to fuel tax reporting, cargo sensors, and electronic door locks.

These updates will only continue across all technology, said Greentree Advisors LLC founder Ken Davis. As we see more manufacturers entering the industry with electric or hydrogen fuel cell-powered vehicles, he believes that 25 percent of the global vehicle market will be electric by 2030–a trend we will see among commercial vehicles as Class 5 to 6 vehicles lean toward electric operation as well.

“Trucking does depend on GPS a lot, but it is generally a very reliable system,” said Driscoll. “The U.S. military depends on it. It’s used for all kinds of commercial and government applications. There can be problems, but they are not very common.”

Supporters of electric commercial vehicles note that current trucks with internal combustion engines cost 30% more than those electrically powered. There are, however, worries around charging infrastructure development and grid capability, as electric vehicle demand is pushed forward by regulation and subsidies.

Although this tech brings innovative benefits to the industry, Powell also explained that disruptions to service can impact the bottom line of a carrier, thus negatively affecting its business overall.

“When you’re talking about drivers having to revert back to paper logs [in the event of a disruption], as an example, it’s a real issue for the industry,” he said “There is a mandate around the repair of ELDs. You have eight days to get a broken ELD repaired. That’s a real issue for fleets.” He also explained that many drivers–especially those new to the industry–could possibly have zero paper log experience.

It would, however, be much easier for truckers to revert temporarily to logging manually than it would be for smaller fleets using TMS systems to have to fall back on manual processes, noted McLeod Software marketing vice president Mark Cubine.

“Those examples are good wake-up calls for the vulnerability of technology,” he said. “Fortunately, in the case of driver’s logs, there is a paper paradigm that an individual driver could go back to.”

Currently, asset managers include mobility providers, said Davis. As services move toward digital reliance, mobility services take the place of financing, maintenance, storage, parking, and ownership. Availability is extremely vital with this mobility, he explained.

“I think the danger is more–in terms of losing functionality of ELDs and fleet management–it’s more [about] individual systems that could have hardware or software failures,” said Driscoll. “I think it’s more in the area of specific devices and specific solutions.”

The way to best combat these large-scale issues? Researching while investing in new carrier technology, said Sutarik.

“Companies that do not share a similar focus on engineering and continuous innovation, and instead accumulate legacy IT debt by focusing their efforts on keeping old and outdated systems working, are made more vulnerable to threats such as downtime,” he explained.

The potential for progress and success will always outweigh the risks, though. Industry professionals like Davis reiterate that staying up-to-date as new technologies grow in development is the best way to stay ahead of important opportunities as they arise throughout the industry.

TMC Meeting Focuses on Industry Tech, Advancing Careers

February 28, 2020 by Levinson and Stefani Leave a Comment

“If you’re all about technical stuff, we’re the place to be,” said Executive Director of American Trucking Associations’ Technology & Maintenance Council, Robert Braswell.

TMC is currently taking place at the Georgia World Congress Center, an annual meeting in Atlanta for trucking industry professionals focusing on technology and equipment to gather, tackle current industry issues, and find ways to work together toward improvement.

“This event is one of the few times that key industry decision makers and technology providers come together to review the latest developments in truck technology–including safety, fuel efficiency, and more,” said Braswell. “It is an event that ATA and TMC’s members should take pride in.”

The TMC website explains the meeting and transportation exhibition as “home to trucking’s leading fleet professionals, vehicle manufacturers, and component suppliers.” It says the conference will include the industry’s most innovative sessions that are “planned by fleets, for fleets,” and that it covers all aspects of maintenance and design for trucking vehicles.

“Now in our seventh decade, TMC continues to promote professionals and develop technical standards for the trucking industry,” said Altec Industries’ fleet optimization manager, Kenneth Calhoun. “The annual meeting and exhibition is a critical part of these efforts. Being able to see the technology in practice on the exhibit hall floor and to discuss and learn about the latest advances in truck technology in our myriad of task forces and educational sessions.”

TMC’S theme is “Advancing Careers in Maintenance Management,” which will aim at addressing the largest maintenance issues across the industry. It will bring together almost 5,000 representatives from across the board–manufacturers, suppliers, government officials and more. Among the service providers present will include some of the largest corporations in the industry, such as Wabco Holdings Inc., CIE Manufacturing, Eaton Corp., Dana Inc., and Mack Trucks.

The exhibit began with around 350 exhibitors on its first day, and will continue hosting displays of innovative technology progression, equipment, and maintenance methods.

“In terms of fleet-driven, member-driven, [and] best practices-driven organizations, that’s what we do,” said Braswell.

The electrical study group will discuss its battery tech while the engine study group will dive into diesel fuel issues. There are also sessions focusing on in-cab systems, wheel maintenance, and trailer repairs.

According to Braswell, these study groups are permanent committees that research and analyze current issues, while task forces are more transient and work to solve certain problems more quickly and then disperse.

One major issue the conference is tackling is that of a shortage of technicians. Currently, the demand for diesel technicians is likely to hit 25,655 by 2021, according to TMC and TechForce Foundation’s research.

During the conference, a three-session track dedicated to career development and management will cover time management for supervisors, causes of waste within fleet maintenance, and company communication skills.

According to Calhoun, the career development session will work to support new careers for employees entering the trucking industry while simultaneously allowing current employees to find help in “building their [benches].”

“I would encourage those members that are coming to look around to say, ‘Where are those individuals in my organization that have shown that spark and that initiative?’ And, ‘How do I get them here to take advantage of professional development opportunities?’” said Calhoun.

In addition, the council has a program dubbed “Leaders of Tomorrow” for fleet maintenance professionals gaining traction in the industry who are in their early 40s or younger, or who have at least five years’ experience.

The Be Pro Be Proud initiative will also take precedence–an effort that works to introduce students to careers in the industry through various presentation methods, including virtual- and augmented-reality technology.

This program has its own trailer equipped with interactive demonstrations, such as how to work with a diesel technician and how to maintain utility poles, and will have locomotive and excavator simulations.

“That’s very rewarding when you can share a vision like that and it actually produces something tangible,” said Calhoun. “As I look at the ability to produce something like [the simulations], where we can begin to engage young people while they’re still in middle and high school to think about the opportunities that are out there, [and] that will be around hopefully long after I’m gone–that’s a big deal.”