IN RE U.S. TRUCK COMPANY, INC. 800 F.2d 581 (1986) CASE BRIEF

IN RE U.S. TRUCK COMPANY, INC.

800 F.2d 581 (1986)

NATURE OF THE CASE: Teamsters (D) appealed an order confirming Truck's (P) reorganization plan in a bankruptcy proceeding.

FACTS: P, a trucking company, had a collective bargaining agreement with D. After filing Chapter 11, P sought to reject that agreement. The court found that rejection of the agreement was 'absolutely necessary to save the debtor from collapse.' New agreements were negotiated to the satisfaction of each participating local union. Those agreements have been implemented over the lone dissent of D. On implementation, P was able to record monthly profits in the range of $125,000 to $250,000. The new agreements achieved these results by reducing wages and requiring employees to buy their own trucking equipment, which the employees then leased to the company. The reorganization plan contains twelve classes. D opposed the plan in that P impermissibly gerrymandered the classes to neutralize D’s dissenting vote. The court approved the plan and D appealed.

ISSUE:

RULE OF LAW:

HOLDING AND DECISION:

LEGAL ANALYSIS:

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