Buckeye Case Delayed

Due to a last-minute filing, the trial on unjust enrichment in the Buckeye Diamond Logistics vs. CHEP USA case, which was set to start in late February, was delayed. CHEP filed a motion asking for nearly $159,857 in washing, repair, lost income and replacement costs associated with Buckeye’s possession and storage of CHEP-marked pallets. The trial has been rescheduled for May 24, 2004.

            The Buckeye lawsuit has been one of the landmark cases in the fight between big blue and recyclers over recycler’s rights when it comes to CHEP-marked pallets that leak into the general exchange pool. In the initial stages of this case, most of the victories have gone to CHEP. The only outstanding issue is how much money a recycler should be compensated for the service of retrieval, storage and returning CHEP-marked pallets. The court was set to hear arguments on this issue until the delay occurred.

            Even though CHEP disclosed its damages after the filing deadline, the court allowed the filing to be considered. Since the court accepted CHEP’s last-minute filing, Buckeye supported a delay because it needs more time to gather evidence to counter CHEP’s claims.

            CHEP claimed it incurred $27,966 ($1.75 per pallet) in costs related to washing CHEP-marked pallets that had been stored outside by Buckeye. CHEP also claimed that Buckeye owes for damage to its pallets which amounted to more than $18,000 in replacement and repair costs. Whether or not Buckeye is liable for these costs will be determined at trial.

            Attempting to shield as much sensitive information as possible, CHEP has filed motions to exclude many pieces of evidence. It appears CHEP is trying to throw out as much as possible.

Buckeye Diamond Logistics vs. CHEP USA

CHEP’s Damage Claims

15,981 pallets washed @ $1.75           $27,966

6,996 parts replaced @ $0.673            $4,708

2301 pallets repaired @ $ 1.07            $2,461

259 pallets replaced @ $ 18.54            $4,801

                                                            $39,936 Total

PLUS: Depreciation in value

Total pallets      Dep. Monthly Average         Mo. Held                 Total

27,395                      $0.1233                           10.1                 $33,995.58

PLUS: Cost of Capital

# of Replacement Pallets           Replacement                 Cost of Capital @ 9%

27,395                                     $538,275.60                       $48,444.78

PLUS: Service fees paid to Buckeye by CHEP customers for CHEP pallets returned to those customers. Total $37,482

Total Claimed Damages $159,857