Delaware Judge Proposes Speedy Trial Resolution for Berkshire Hathaway and Haslam Family Dispute

Delaware judge proposes a speedy trial resolution for Berkshire Hathaway and Haslam family's dispute over Pilot Travel Centers. Get the latest updates on this legal showdown.

Dec 2, 2023 - 09:51
Dec 2, 2023 - 09:52
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Delaware Judge Proposes Speedy Trial Resolution for Berkshire Hathaway and Haslam Family Dispute
Delaware Judge Proposes Speedy Trial Resolution for Berkshire Hathaway and Haslam Family Dispute

A Delaware judge has suggested a January trial to address the ongoing dispute between Warren Buffett's Berkshire Hathaway and billionaire Jimmy Haslam. The conflict centers around allegations that Haslam tried to improperly inflate his stake in the truck stop chain Pilot Travel Centers.

Vice Chancellor Morgan Zurn of Delaware's Court of Chancery issued a ruling indicating a willingness to expedite Berkshire's case next month, provided certain conditions are met. Zurn expressed a preference for efficiency by resolving Berkshire's claims concurrently with a trial scheduled for January 8-9, where the Haslam family asserts that Berkshire was devaluing Pilot Travel Centers.

The primary issue at hand is determining the financial obligations Berkshire would incur if the Haslams decided to sell their 20% stake in the country's largest truck stop chain to Berkshire in early 2024.

Zurn has given Berkshire until 9 a.m. ET on Monday to decide whether it accepts a January trial, contingent on limiting discovery to what is essential for defending against the Haslam family's lawsuit.

Berkshire contends that a prompt resolution is crucial to prevent irreparable harm, especially before the Haslams exercise their option to sell the stake. Berkshire currently owns 80% of Pilot, having acquired a 38.6% stake for $2.76 billion in 2017 and an additional 41.4% for $8.2 billion in January.

The opposing sides accuse each other of manipulating Pilot's earnings, the basis for valuing the stake. The Haslams filed a lawsuit against Berkshire in October, accusing the company of seeking a "windfall" through accounting practices. Berkshire countersued on November 28, alleging that Jimmy Haslam attempted to bribe Pilot executives to inflate earnings in 2023 at the expense of future years.

The dispute also centers on the valuation of the 20% Pilot stake, with the Haslams estimating it at $3.2 billion before Berkshire's accounting change, a figure disputed by Berkshire.

Pilot Travel Centers, headquartered in Knoxville, Tennessee, operates approximately 800 locations. Berkshire Hathaway, based in Omaha, Nebraska, owns an array of businesses, including the BNSF railroad and Geico car insurer.

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