A Kansas-based trucking company, cited numerous times for safety violations for both its drivers and equipment, recently filed Chapter 11 bankruptcy.
Elite Transportation, headquartered in Wichita, filed its petition in the U.S. Bankruptcy Court for the District of Kansas on Friday.
In the filing, Elite lists its assets as up to $500,000 and liabilities as up to $10 million. The trucking company states that it has up to 199 creditors and maintains that funds will be available for distribution to unsecured creditors once it pays administrative fees.
Among the 20 largest unsecured creditors are Foust Fleet Services of Topeka, Kansas, owed $750,000; the IRS, owed more than $731,000, which Elite disputes; and Ryder Transportation Services of Chicago, owed more than $177,000. The company owes Trillium Staffing, a driver recruiting company headquartered in Detroit, nearly $50,000.
Elite’s attorney, Mark Lazzo, did not respond to FreightWaves’ request seeking comment.
History of safety violations
In the petition, the company states that it owes a Colorado law firm, Warren Johson Jester Gibson and Moore of Denver, more than $568,000, after it represented one of the company’s former drivers. DeWarren Johnson filed suit against Elite in March 2021, alleging he was retaliated against and was fired for refusing to drive unsafe equipment, a violation of the Surface Transportation Assistance Act (STAA).
He sent numerous photos of the equipment, which he claims in the suit had “rusted brakes, tampered emissions and expired tags.” According to the suit, Johnson was offered $800 “if he agreed to make deliveries in the unsafe vehicle.”
After refusing to operate the truck, Johnson claims Elite’s manager, Crystal McCullough, fired him the next day.
The trucking company, which provides warehousing and distribution services, has 25 drivers and 24 power units and has a conditional rating, according to the Federal Motor Carrier Safety Administration SAFER website.
Its trucks had been inspected 51 times and 21 had been placed out of service in a 24-month period, resulting in a 41% out-of-service rate. This is higher than the industry’s national average of around 21%, according to FMCSA data. Elite’s drivers were inspected 63 times and 11 were placed out of service, resulting in a 17.5% out-of-service rate. The national average for drivers is around 5.8%.
A hearing on Elite’s Chapter 11 case is tentatively scheduled for April 13.
Got a tip? Contact Clarissa Hawes at chawes@freightwaves.com.
Read more articles by Clarissa Hawes:
US trucking company owner races to Ukrainian border to aid refugees
Who killed Roger Kelly? Trucker’s case remains unsolved 22 years later
‘People’s Convoy’ begins rolling to Washington with message against COVID restrictions
Massachusetts logistics company folds, files Chapter 7