Landstar has announced it will appeal a U.S. District Court ruling certifying a class action in a lawsuit over Landstar’s owner-operator contracts.
The Owner-Operator Independent Drivers Association and four owner-operators have sued Landstar, alleging that the fleet’s contractual agreements with its independent owner-operators do not meet federal disclosure requirements.
OOIDA claims that Landstar overcharged owner-operators for fuel and fuel-related transaction fees, failed to disclose and deduct amounts related to military shipments, and overcharged for base plates and permits issued by the states.
Certification as a class action opens the door to more plaintiffs joining the suit and allows a single ruling to bind all the parties. U.S. law requires all plaintiffs in a class action to be “similarly situated,” meaning likewise affected by a defendant’s actions.
Landstar believes that “individual contractor-specific issues predominate over common issues, and will therefore ask the U.S. Court of Appeals in Atlanta to overturn this ruling,” said Michael Kneller, Landstar vice president and general counsel.
The District Court ruling itself acknowledged that “the issue of damages will be unique and subject to individualized proof,” Kneller said. That undercuts the argument for class-action status, Landstar argues.
The appeal was not unexpected, said Todd Spencer, OOIDA executive vice president. “One of the defense strategies in cases like this is to try and run the other side out of money,” he said.
For an individual trucker to file such a suit against Landstar would be almost impossible, Spencer said, arguing that an individual would have neither the time nor the money. “It is for that very reason that these particular cases have to be class actions,” he said.
Whether or not the suit is ultimately judged a class action, Landstar will “continue asserting its defenses vigorously,” Kneller said.