The lawsuit, filed in Shelby County Chancery Court in Memphis, Tennessee, claims the executives wasted company assets and endangered the employees’ retirement funds. The suit charged that the value of Overnite has plummeted from its 1986 purchase price of $1.2 billion to about $300 million today.
“By flagrantly violating the nation’s labor laws, Union Pacific’s executives and board members put the entire company at risk and decimated the value of one of its biggest assets, Overnite Transportation,’ said Bill Lerach, lead plaintiffs attorney.
Those named in the suit include Drew Lewis, Union Pacific’s chairman and chief executive from 1987 through 1996 and Secretary of Transportation during the Reagan administration; Richard Davidson, Union Pacific’s CEO since 1996; Leo Suggs, chairman and CEO of Overnite since 1996; and Suggs’ predecessor, James Douglas.
Omaha-based Union Pacific told Reuters that the lawsuit was “totally without merit’ and was part of an ongoing campaign by the Teamsters Union against the company. Union Pacific shares rose 44 cents to $52.49 Thursday, toward the upper end of its 52-week range.
In February, a federal appeals court upheld a lower court decision against Overnite, concluding the company was, “guilty of a litany of serious and pervasive misconduct and violations,’ of the National Labor Relations Act.
– Fred Schneyer firstname.lastname@example.org
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