2013-01-11 19:40:26 -
Swift Transportation Company, Inc. ("Swift") (NYSE: SWFT) announces it has
settled the driving academy class action litigation related to the issuance of
commercial driver licenses (CDLs) in Tennessee. All amounts related to this
settlement were fully reserved in prior periods in accordance with generally
accepted accounting principles, and thus there will be no additional charges in
the fourth quarter of 2012 or future periods. The settlement is not an
admission of liability and provides expressly that Swift denies the allegations
of the lawsuits and denies that it engaged in any wrongdoing or improper
conduct.
Swift also announces that it has settled its cross claim against the Tennessee
Department of Safety ("TDOS") that was part of the driving academy class action
litigation. This settlement includes a formal retraction by TDOS of its public
statements relating to the third party CDL testing of drivers and payment by
TDOS for a portion of the costs that Swift incurred in the litigation.
The United States District Court for the Western District of Tennessee has given
final approval to the settlement of the class action lawsuits consolidated in
that court under the lead case of Ham v. Swift Transportation Company, Inc. The
lawsuits asserted claims by former students of Swift's Driving Academy in
Millington, Tennessee relating to the requirement by Tennessee and other states
that the students re-test in support of their CDLs. The plaintiffs contended
that Swift and its employees as third-party CDL examiners for the State of
Tennessee failed to administer portions of the CDL exams in accordance with
Tennessee and federal regulations. Swift denied the allegations of the lawsuits
and denied that it engaged in any wrongdoing or improper conduct. Swift settled
the class action lawsuits to avoid the expense of further litigation, to dispose
expeditiously of the claims asserted, and to avoid the uncertainty of protracted
litigation
Pursuant to the class action settlement, Swift has agreed to make certain
payments to qualifying class members on a claims-made basis which will be within
the dollar range that Swift previously disclosed in its public filings and Swift
will also agree to relinquish any legal claims to amounts owed by class members
for unpaid academy tuition. The period within which potential class claimants
had to file a claim expired on November 17, 2012 and less than 730 individuals
filed a claim within the claim period. Based on the review of those claims, the
total cash payments by Swift relating to the settlement including legal costs is
expected to be within the amounts that were disclosed in the company's prior SEC
filing and which were fully reserved for in prior periods in accordance with
generally accepted accounting principles. Moreover, although Swift will
relinquish its legal rights to approximately $16 million in amounts owed to it
by class members for unpaid academy tuition, such amounts were fully reserved
for in prior periods in accordance with generally accepted accounting principles
and thus no additional charges or financial impact will be recorded for the
relinquishment of such unpaid tuition receivables in connection with the
settlement.
Two plaintiffs have appealed the court's approval of the settlement in part
because they were not awarded individual awards and because their attorneys were
not allocated a portion of the counsel fees provided for in the approved
settlement. Under the terms of the settlement agreement, the settlement of the
class action lawsuits is not final until that appeal is either settled by the
parties or resolved by the court.
Swift also announces that it has settled its cross claim against the TDOS that
was part of the consolidated class action lawsuits. In 2008 and 2009, TDOS made
public statements contending that Swift and its employees as third party CDL
examiners had failed to administer portions of the CDL tests in accordance with
Tennessee and federal regulations. These statements led to other States taking
action against drivers' CDLs and ultimately to the filing of the consolidated
class action lawsuits against Swift. Swift's cross claim contended that the
TDOS statements were not based on a reasonable investigation, were without
basis, and were not true and sought a declaration from the court to that
effect. Swift has reached a settlement of that cross claim with TDOS. The
settlement includes a formal retraction by TDOS of its public statements
relating to the third party CDL testing of drivers and payment by TDOS for a
portion of the costs that Swift incurred in the litigation. This formal
retraction can be found on the TDOS website at
www.tn.gov/safety/driverlicense/cdlalt.shtml
Contact Info:
Jason Bates, Vice President of Finance and Investor Relations Officer
or
Ginnie Henkels, Executive Vice President and Chief Financial Officer
Office: 602-269-9700
This release contains statements that may constitute forward-looking statements,
which are based on information currently available, usually identified by words
such as "anticipates," "believes," "estimates",
"plans," "projects," "expects,"
"hopes," "intends," "will," "could," "may,"
or similar expressions which speak
only as of the date the statement was made. Such forward-looking statements are
made pursuant to the safe harbor provisions of the Private Securities Litigation
Reform Act of 1995. Such forward-looking statements are inherently uncertain,
are based upon the current beliefs, assumptions and expectations of Company
management and current market conditions, which are subject to significant risks
and uncertainties as set forth in the Risk Factor Section of our Annual Report
Form 10-K for the year ended December 31, 2011. The Company makes no
commitment, and disclaims any duty, to update or revise any forward-looking
statements to reflect future events, new information or changes in these
expectations.
This announcement is distributed by Thomson Reuters on behalf of
Thomson Reuters clients. The owner of this announcement warrants that:
(i) the releases contained herein are protected by copyright and
other applicable laws; and
(ii) they are solely responsible for the content, accuracy and
originality of the information contained therein.
Source: Swift Transportation Corporation via Thomson Reuters ONE
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