Source: https://getmansweeney.com/current-cases/swift-transportation-co-inc-forced-labor-minimum-wage
Timestamp: 2019-04-21 11:01:57+00:00

Document:
After almost ten years of diligent effort by the entire legal team at Getman, Sweeney & Dunn, Martin & Bonnett, and Edward Tuddenham, a class action settlement between the driver Plaintiffs and Defendants Swift, IEL, Moyes and Killebrew, has been reached.
If the settlement is approved by the Court, it will resolve the claims of roughly 20,000 owner operator drivers (since 1999) in this case. The settlement cannot take effect until the Court approves it, and the approval process will consider comments from the affected drivers.
Counsel are unable to give details until the Court considers the “preliminary” fairness of the settlement. Also, there are no details available yet as to what the deal will mean for any individual.
The settlement agreement has been presented to U.S. District Judge John W. Sedwick for review and approval. If the court preliminarily approves the settlement, a Claims Administrator (Settlement Services, Inc.) will be appointed to send each driver affected by the settlement a Notice advising them of the terms of the settlement, what it will mean for them, how to file a claim in the case, how to withdraw, or object to the deal, and how to update your address so that you can receive your share of the proceeds. SSI will also set up a settlement website to give important information about the case and provide forms to Class Members, including claims forms and change of address forms. Drivers will be given four months (after notice is mailed) to make their claims, objections or withdraw from the case. The Court will also establish a date and time for a final fairness hearing to consider the response of the class and whether to approve the settlement. We are hopeful that if the settlement is finally approved it will result in payments before the end of 2019 or early in 2020.
Please be patient. We will continue to post the progress of the settlement process as it evolves.
On February 27, 2018, the Ninth Circuit stayed this case pending a decision by the Supreme Court in the New Prime v. Oliveira case, in which the Court considered whether the Federal Arbitration Act applied to interstate truckers. On January 15th, 2019, the Supreme Court reached a unanimous decision in truckers’ favor—ruling that truckers engaged in interstate commerce are exempt from the FAA under Section 1, regardless of whether their contracts call them contractors or employees. This means that, in most cases, truckers will not be forced into mandatory arbitration and cannot waive their rights to participate in class actions. Thus, the Supreme Court decision eviscerates Swift’s appeal of the District Court by claiming that the Court erred in finding the drivers to be employees, rather than contractors. It also means that the case should be back in full swing in the District Court after a long stay. Plaintiffs expect that the District Court’s order of January 6, 2017 will almost certainly be summarily affirmed and Swift’s appeal will be dismissed.
We will post more as new information becomes available.
Because the Supreme Court has granted certiorari to (agreed to review) New Prime Inc. v. Olivera, the Ninth Circuit Court of Appeals has stayed Swift’s appeal of the Arizona District Court’s January 2017 Order (in which the District Court ruled that the case cannot go to arbitration because the named-plaintiff drivers were/are employees—not independent contractors—as a matter of law). Plaintiffs in this case relied upon the New Prime rationale as one of the reasons for affirming our District Court decision. Swift’s appeal has been removed from the court calendar and all related proceedings have been stayed until the Supreme Court decides the New Prime case.
The New Prime case held that the Federal Arbitration Act (“FAA”) Section 1 Exemption also exempts independent contractor agreements for workers in interstate transportation (such as truckers) from mandatory arbitration in federal courts. Courts are split on these issues, interpreting the law in different ways, and so the Supreme Court has agreed to hear the arguments and make final determinations on those issues. The New Prime case is not yet set for argument, but it will likely be during the October 2018 term—and a final decision on the issue will not happen until sometime after that.
In the meantime, the Ninth Circuit stay means that our case cannot proceed until these issues are resolved by the Supreme Court.
We will update this webpage as the situation develops further.
On July 24, 2017, the Drivers filed their opposition to Swift’s appeal of the District Court’s order finding that drivers are employees and thus exempt from arbitration. Also, the non-profit organization Public Justice filed a “Friend of the Court” brief in support of the drivers, to argue that the Federal Arbitration Act exempts all contracts of “employment” for workers in interstate transportation, no matter whether the worker is employed as a contractor or an employee. The Appeal is fully briefed.
We understand there may be some concern and confusion regarding interpretation of certain provisions of the new ICOA issued on January 9, 2017, and the effect of those provisions on your rights in ongoing legal proceedings, including the lawsuit currently pending in the United States District Court in Phoenix, Arizona, titled Van Dusen v. Swift Transportation Company Inc. We are sending this message to clarify that the new ICOA will not interfere with your rights to participate or recover monetary relief in ongoing court proceedings in existence on January 9, 2017. Specifically, two sections, Paragraph 16 (“Reclassification”) and Paragraph 17(E) (“Indemnification” in relation to unsuccessful proceedings alleging employee status of “Contractor’s workers”), will not apply with respect to any relief granted to the parties in the Van Dusen lawsuit. This is true regardless of whether or not you have already signed the new ICOA. Paragraphs 16 and 17(E) do not waive or limit any rights or remedies you may have under any state or federal wage payment laws and statutes, including the Fair Labor Standards Act. The indemnification provision in Paragraph 17(E) will not require you to pay the Company’s attorneys’ fees or expenses for any claims you bring or which are brought on your behalf in the Van Dusen lawsuit.
Swift will not retaliate against any Contractor who chooses to participate in any ongoing court proceedings.
If you have any questions about these points or any others, you can consult with an attorney. The attorneys for the Plaintiffs in the Van Dusen case are: DAN GETMAN, GETMAN, SWEENEY & DUNN, PLLC., (845) 255-9370.
THIS MESSAGE HAS BEEN APPROVED BY THE COURT IN VAN DUSEN.
THE COURT HAS NOT YET RULED AND TAKES NO POSITION ON THE MERITS OF PLAINTIFFS’ CLAIMS FOR RELIEF.
US District Court Judge Sedwick has set expedited argument on Plaintiffs’ motion for a Temporary Restraining Order and Swift’s motion for a stay of the case pending appeal for Wednesday, February 15, 2017 at 10:00 am in Phoenix. We will post further updates as information becomes available.
On Friday, January 6th, the Court ruled in favor of the drivers with respect to arbitration—the case will remain in federal court. Swift is appealing that decision, and we will fight their appeal. Swift has also asked the court to stay all proceedings pending appeal. The court has asked Plaintiffs to respond no later than February 10, 2017.
On January 9th, Swift rolled out a new contract to their currently-running Lease Operators. Swift has said that the contract must be signed by March 1st, 2017, and is retroactive to January 1st, 2017.
The release of the new contract has been accompanied by an initial message to drivers through Qualcomm, with a repeated follow-up message. Many drivers are also being pressured by their Driver Managers/Driver Leaders to sign, and it appears that the DMs/DLs are similarly being pressured to push their LOs to sign.
Plaintiffs filed an application for a Temporary Restraining Order and Preliminary Injunction with the court on Monday, January 30th, and we received a response from the court the following day, January 31st, with a schedule to address our concerns. Defendants must respond by February 7th, and Drivers will reply to their response on the 10th. The court expects to hear argument on the motion during the week of February 13, 2017.
We believe the contract is unlawful, deceptive, and coercive, and we are asking that the Court grant a temporary restraining order and preliminary injunction:(1) enjoining ¶16 and ¶17E of the new Agreement; (2) requiring Defendants to inform all lease operators including those who have already signed the Agreement that paragraphs 16 and 17E have been enjoined and are no longer operative; (3) enjoining Defendants and their counsel from engaging in any further contacts with current opt-ins and putative class members regarding the matters raised in this suit, including communications that request or require LOs to enter into agreements that may in any way impact the liability or damages issues that are currently pending before this court, without first informing Plaintiffs’ counsel and obtaining permission from the Court.
In addition, Plaintiffs have moved to renew their Collective Action Motion, which is fully briefed by both sides, and have moved for Class Certification of a nationwide class of Lease Operators.
On January 6th, 2017, after a six-year battle which included multiple appeals to the 9th Circuit and even reached up to the Supreme Court, Judge Sedwick of the Arizona District Court ruled that the five named-plaintiff drivers are employees, not independent contractors as a matter of law, for the purposes of § 1 of the Federal Arbitration Act. You can read the full, 33-page decision here. The most important result of this decision is that the case cannot go to arbitration, as Swift argued it should, and will instead remain in the federal court where it was initially filed.
Swift will likely try to appeal this decision, but we believe the court’s ruling is correct and well-reasoned.
This is an extremely significant result, and an important step in the ongoing fight, but it is not the end—there has been no judgment whether OOs/LOs are entitled to the back wages and other relief we believe they are owed. There are many issues still to be decided by the Court, including which drivers are allowed to participate (beyond the people who have already opted-in to the case); how far back claims may go; what notices should be issued; what discovery is still needed for the parties to resolve the case; and when any remaining issues can be tried.
The next step will involve a Motion for Collective Action, with a request for notice of the lawsuit to go out to all the drivers who worked for Swift as Lease Operators within the Statute of Limitations.
The best source for current case updates is the website. We will continue to post new information as it becomes available.
U.S. District Judge Sedwick issued a decision today that the five Plaintiffs who brought this case are employees as a matter of law, for purposes of the Federal Arbitration Act. The decision means that the case will remain in federal court and will not go to arbitration as Swift had demanded. Click here for decision. This is an extremely significant decision. We will post additional analysis of the decision in the next few days!
The Ninth Circuit ruled that the Court must decide whether this case is arbitrable under the Federal Arbitration Act (“FAA”) or not before sending the case to arbitration. Over the past several weeks, Plaintiffs deposed Swift and IEL, and Swift deposed the five Named Plaintiff drivers. All of these depositions went very well, all resulting in good testimony on the record. Significant documentary discovery was exchanged as well.
The parties are now ready to brief whether or not Lease Operators are employees or contractors for purposes of deciding whether the Federal Arbitration Act applies to the drivers or not so that the District Court can decide. Section 1 of the FAA exempts from arbitration “contracts of employment of . . . any other class of workers engaged in foreign or interstate commerce.” Swift claims that the drivers are not employees and the drivers claim that they are employees as a matter of law, and thus, under the Section 1 exemption, that the Court must decide this case rather than an arbitrator.
We will file our Motion for Summary Judgment on the Federal Arbitration Act Section 1 Exemption in mid-June, and defendants will have a month to respond to our motion. After that, drivers will have a month to reply to defendants’ response. After all of the briefing is complete (by September 16, 2016), the Court will rule on the misclassification issue. The timeline for a decision is uncertain. We will post more information as it is available.
On Monday, November 16th, 2015, the 9th Circuit Court of Appeals heard oral arguments on the defendant’s interlocutory appeal and petition for a writ of mandamus appealing the district court’s scheduling order. The court’s video feed of the argument is available here.
On July 15th, 2015, Judge Sedwick granted the Drivers’ motion to compel discovery responses (see update dated August 18, 2015), ordering Swift to produce the requested documents, yet Swift has refused to comply with those requests. In response to Swift’s unwillingness to cooperate in the discovery process, Drivers filed a Motion for Sanctions (Dkt 684) on September 22, 2015, including a request that the Court finds Swift in contempt of Court and to fine Swift each day until they comply with all outstanding discovery. Swift responded on October 9, 2015 (Dkt 689), and Drivers replied on October 22 (Dkt 695).
Despite numerous decisions to the contrary from Judge Sedwick, Swift continues to argue that the question of whether this case should go to arbitration (and, by extension, whether Drivers are Independent Contractors or Employees) hinges only on the evidence from the “Contractor Agreements,” and not from any other source of information (Dkt 15-15257 16-1). The Drivers believe that other factors illustrate the relationship between Swift and the Drivers (Dkt 15-15257 21-1). The case law supports Drivers’ view. Even though Swift’s position is wrong, Swift asked both the Arizona Court and the 9th Circuit Court for a stay of the case while they appeal Judge Sedwick’s most recent scheduling and discovery decision. The Drivers opposed the stay, and ultimately both courts denied the stay requests, again agreeing with the Drivers. Swift is now attempting to extract the stay they were denied by refusing to cooperate with the discovery process, requiring the Motion for Sanctions. Swift filed two appeals with the 9th Circuit—an interlocutory appeal and a Petition for Mandamus, both essentially arguing the same issue—that the discovery and scheduling order that Judge Sedwick issued amounts to a trial on the merits of the case, and prejudices the defendants. Drivers disagree, maintaining that this information is necessary for the Judge to be able to rule correctly on the question.
The case in the district court will continue on the same schedule the judge set, and at the same time, both parties will argue the appeals. Oral Arguments for both the interlocutory appeal and the Petition for a Writ of Mandamus have been scheduled for Monday, November 16, 2015 – 9:00 A.M.
In the meantime, we await Judge Sedwick’s decision on the Drivers’ most recent motion for sanctions. We will post more information as it becomes available.
In response to Swift’s continuing refusal to participate in the discovery process, Plaintiffs filed a Motion to Compel Discovery Responses (Docket # 631) from the Defendant on April 1st. Plaintiffs also filed a Motion to Compel defendants to testify [in depositions] (Docket #644) on July 13th.
. . . Defendants assert that the issue of whether Plaintiffs entered into contracts of employment for purposes of arbitration exemption is distinct from the issue of whether Plaintiffs functioned as employees. The court rejected that argument at docket 546 and then again at docket 605 after a detailed analysis of other Section 1 cases and applicable case law regarding employment classification. . . . For the same reasons set forth in detail at docket 605, the court rejects Defendants’ arguments once again. [The Ninth Circuit Court of Appeals] requires the [Arizona District] court to look at the economic realities of the parties’ working relationship and not just the contract at issue or the parties’ subjective intent.
Swift then filed Motions to Compel Discovery of Plaintiffs (646 and 649) on July 22nd, and filed Motions for a Protective Order (652 and 654) on July 20th.
Plaintiffs filed their Oppositions to both sets of motions (665 and 671) on August 3rd and August 6th. Swift replied to Plaintiffs’ response to their motions to compel discovery (674) on August 14th.
Plaintiffs also replied to Defendants’ opposition to compel testimony (672) on August 11th. We are awaiting decisions by the District Court on all pending discovery motions.
Meanwhile, Swift’s mandamus petition and appeal of the District Court’s decision to hold a trial of employment status are pending before the Ninth Circuit Court of Appeals. Click here to read Plaintiffs’ Response Brief.
The law of truck driver misclassification as independent contractors continues to develop, with many courts finding drivers misclassified. Two important decisions were rendered by the Ninth Circuit court of appeals with respect to FedEx drivers. Another important decision was rendered by the trial judge in this case, U.S. District Judge Sedwick in Collinge.v.Intelliquick finding drivers very similar to Swift drivers to be employees as a matter of law. This case was also handled by Martin & Bonnett, co-counsel for the drivers in this case.
As this case moves toward its inevitable conclusion, Swift continues to make numerous efforts to delay the day of decision. After Swift filed its Petition for Mandamus asking the Ninth Circuit to find that Judge Sedwick acted in “clear” error by stating he will consider evidence beyond the contract to determine if the drivers are employees, the Ninth Circuit asked Plaintiffs to file an Opposition to Swift’s Petition For Mandamus which was filed on June 10, 2014. In addition to filing its petition for mandamus, Swift also filed a notice of appeal from the same decision. Plaintiffs moved to dismiss that appeal, but that motion was denied by the Circuit. We continue to believe that the appeal is entirely improper since appeals are only available from a final order (deciding a claim) or if a statute confers the right to an interlocutory appeal and the Court of Appeals stated this issue would be considered in our opposition brief. In that brief, the drivers will argue that Judge Sedwick’s decision allowing discovery is hardly a “final order” and no statute confers the right to an appeal from this order. Swift has now filed its appeal brief with the Ninth Circuit. The drivers’ brief will be due July 22nd. Swift had also asked the Ninth Circuit and the District Court to stay proceedings while the appeal is pending. Both courts denied Swift’s motion to delay the proceedings. Nevertheless, Swift has refused to meaningfully participate in discovery in the District Court, despite the denial of a stay. So, the drivers filed a motion in the District Court to compel Swift to answer discovery. Swift filed its response. Plaintiff drivers filed a Reply Brief. The motion is still pending in the District Court.
Even after the Court’s denial of Swift’s motion to reconsider, Swift has done everything within its power to delay the day of reckoning – a day in the near future when District Judge Sedwick will determine whether by law, Swift treats the Named Plaintiffs as employees. Swift has repeatedly asked the Court to consider whether the drivers are employees based only on the contract and lease. The Drivers, and the Court have agreed that the determination requires considering Swift’s policies and practices in addition to the contract and lease. After the District Court rejected Swift’s motion to reconsider the discovery process for this determination, Swift filed a notice of appeal. The Drivers believe that this appeal is entirely frivolous, as there is no right to appeal an interim decision of a District Court regarding how employee misclassification is to be determined. Swift also filed a motion with the District Court asking the Judge to stay proceedings in the District Court while the appeal was pending. We opposed Swift’s application for a stay and asked the Court to sanction Swift for a frivolous motion. While the Court did not sanction Swift, Judge Sedwick also did not grant Swift the stay it had sought. Click here to review the Court’s Decision. Today, Swift has filed a petition for Mandamus asking the Ninth Circuit to rule that Judge Sedwick acted in “clear” error by stating he will consider evidence beyond the contract and that no other legal avenue is available to correct this error. We continue to believe that the Ninth Circuit will unequivocally deny Swift’s efforts to take the issue (which the Ninth Circuit directed Judge Sedwick to hear) away from Judge Sedwick at this point. Since Judge Sedwick has refused Swift’s motion for a stay, Swift’s filings in the Ninth Circuit should do nothing to derail the inevitable progress of this case toward discovery and dispositive motions by December 2015, and if necessary, a trial shortly thereafter.
In July of 2014, both sides submitted proposed schedules to the District Court for how the case should proceed to resolve the question of whether the drivers are employees as a matter of law – this being the question the Ninth Circuit directed the District Court to decide. If the drivers are employees, their claims cannot be sent to arbitration. The drivers called for discovery and a trial; Swift said the Court should make a decision based solely on the contract and lease. The Court adopted the drivers’ proposal. Shortly thereafter, Swift moved the Court to reconsider this order. On January 22nd, the Court denied Swift’s motion again deciding that a trial on the issue of whether the drivers are employees is required by the Ninth Circuit and that the trial would consider evidence of Swift’s practices outside those identified in the contract and lease themselves. During the period that the parties have been waiting for the Court’s decision, the Drivers have served discovery demands and held many meetings to discuss the scope of discovery. For the most part, Swift has refused to participate in discovery, though this may change in light of the Court’s ruling today. The Court also extended the discovery period by seven months, to give the parties time to complete discovery on the relevant issues.
The U.S. Court of Appeals for the Ninth Circuit ordered that the District Court must determine whether the Federal Arbitration Act applies to the drivers in this case before deciding whether it must send the case to arbitration. The FAA states that “nothing herein contained shall apply to contracts of employment of seamen, railroad employees, or any other class of workers engaged in foreign or interstate commerce.” Thus, according to the Ninth Circuit, the Court must determine whether the drivers are “employees” before deciding whether it must send the case to arbitration. U.S. District Judge Sedwick asked the parties to submit a joint proposal for the schedule of this case to determine whether the drivers are employees. The drivers asked for limited discovery on this issue, while Swift argued that the determination should only be made by considering the “Independent Contractor Operating Agreement.” Judge Sedwick ruled that the drivers were right. Despite this ruling, Swift has now asked the District Court to stay its motion or reconsider the scope of discovery and trial. The drivers’ attorneys have opposed this motion and filed an opposing brief arguing that the issue was already decided and that Swift failed to meet the requirements for a motion to reconsider. The parties expect Judge Sedwick to rule shortly on the issue of the scope of discovery and trial.
We expect Judge Sedwick to reaffirm his prior ruling that he will hear the evidence to determine if drivers were misclassified and are in fact employees and not make the decision solely on the basis of the contract. We have worked hard for the past four and a half years to get the Court to rule on this basic legal issue of our case, including two trips to the Ninth Circuit Court of Appeals and defending against Swift’s petition to reverse the Circuit in the U.S. Supreme Court. The issue of whether drivers were treated by Swift as employees is now moving closer to resolution. While this issue is pending, the drivers have served discovery demands on Swift for documents and data related to the employment/contractor misclassification question and are awaiting Swift’s response.
The Ninth Circuit Court of Appeals directed the District Court to decide whether owner operators are employees or independent contractors prior to sending the case to arbitration. If the drivers are employees, the case cannot be sent to arbitration. The Court has now set a schedule for determining a critical issue in this case. The parties filed competing proposals for how the issue should be decided. Plaintiffs asked the Court to hold a trial on the issue, while Swift asked the Court to limit its consideration on the issue to the agreement it drafted and imposed. The Court adopted Plaintiffs’ proposal. The parties now have a short period of time to conduct discovery prior to a trial by the District Court on this critical issue. Plaintiffs also made a motion to add two additional named representatives. So far Swift opposes this motion. Additionally, Swift has now made a motion to ask the District Court to reverse its prior decision as to the scope of discovery and trial. Plaintiffs’ counsel will oppose this motion shortly.
In Ellis v. Swift Transportation Co. of AZ, the plaintiffs claimed that Swift violated the federal Fair Credit Reporting Act by performing credit checks without advising applicants of certain things required by the law. A tentative settlement was reached between the parties which called for each owner operator to receive $50 in settlement of these claims. The settlement notice that was mailed did not advise owner operators of the full scope of claims that might be “released” by accepting the $50 or by failing to exclude themselves from the settlement. Because the release language in the settlement could be taken to mean that Owner Ops give up claims which are being raised in this case: such as whether Swift engaged in Forced Labor by using the DAC Report to force drivers to continue to work for Swift, Getman Sweeney is extremely concerned that settlement is not in any Owner-Operator’s interest. Plaintiffs’ lawyers in this case are reaching out to the Plaintiffs’ attorneys in Ellis v. Swift, to see if our concerns can be addressed in such a way that the drivers can participate in that settlement and avoid giving up claims that are asserted in this case. Until further notice, however, Getman Sweeney advises its clients to DO NOTHING with respect to making a claim in the Ellis case. We will be in touch with clients individually following our discussion with the lawyers for the drivers in the Ellis case. If you have not heard from us individually by mid-September, please contact the office for further advice concerning how to handle claims in the Ellis case.
The Supreme Court today denied Swift Transportation’s motion to hear Swift’s argument as to why the 9th Circuit Court of Appeals was wrong. This is a significant victory for the Drivers in this case. The Supreme Court’s ruling, leaves standing a ruling by the Ninth Circuit which was favorable to the drivers, holding that the District Court cannot send the case to arbitration to determine whether the Federal Arbitration Act applies. While the issue is fairly technical, it is an important one for truckers. Most importantly, it means that there will not be another year or more of delay before the case moves forward.
Swift has filed a “petition for certiorari” with the Supreme Court asking the high court to hear Swift’s challenge to the Ninth Circuit’s decision that the District Court must decide whether the Federal Arbitration Act applies to this case before sending the case to arbitration. The Ninth Circuit’s ruling was a critical decision in favor of the drivers, since it meant that the District Court must decide whether the ICOA/Lease constitute a contract of employment, and if the Court found the contract to be one of “employment” then the case would never go to arbitration. In fact, in a similar case against Central Refrigerated, the Court found the ICOA/Lease to be a contract of employment that could not be sent to arbitration under the Federal Arbitration Act. Swift wants the drivers to have to ask that question individually in arbitration – where it knows that few, if any, drivers will be able to afford litigating the case individually. The Ninth Circuit had agreed to stay its decision, giving Swift 90 days in which to make another stay motion to the Supreme Court, which it has not done. If the Supreme Court does not stay the case while it considers whether or not to take the case, the current stay will expire. Click here to read Swift’s petition for certiorari. The Supreme Court gets approximately 7,000 requests to hear cases each year, but hears only one to two percent.
On November 6, the 9th Circuit Court of Appeals ruled that the District Court erred by sending the case to arbitration. Because the Federal Arbitration Act (under which the Court sent the case to arbitration), does not apply to “contracts of employment” of workers in interstate transportation (such as truck drivers), the Circuit Court held that the District Court cannot send our case to arbitration until it has determined whether the drivers are employees. If the District Court determines that drivers are employees, the case cannot be sent to arbitration and will remain in federal court. Click here to read the Court of Appeals’ ruling. The process for deciding whether the drivers are employees has not been settled by the Court.
The Ninth Circuit has now decided that it does not need oral argument to decide the issue the Drivers presented on appeal, whether the District Court must decide whether Drivers are employees or contractors before it can send the class action filed against Swift to arbitration. If the Court finds the Drivers to be employees, it could not send the case to arbitration at all. The Drivers consider it a hopeful sign that the Circuit decided not to hear argument, as the Ninth Circuit previously decided that the drivers’ claims cannot be sent to arbitration without the District Court first deciding whether they are employees or contractors, when the Drivers filed a “mandamus petition” in that Court. While the lawyers believe the Court’s decision is a good sign, we cannot be sure when the Circuit will make a decision on the case. It has taken over a year for the Circuit to set a date for argument. While the appeal moves slowly, we have every reason to be optimistic about a favorable outcome.
The parties continue to wait for the Ninth Circuit Court of Appeals to determine whether District Judge Sedwick erred by sending this case to arbitration without deciding first whether the Plaintiffs are exempt from the Federal Arbitration Act. The appeal was fully briefed 15 months ago on May 1st, 2012. While the Ninth Circuit may take as long as it wishes, either to schedule oral argument or to decide the appeal without argument, we believe there is a good chance we will be scheduled for oral argument during the Court’s November calendar. Getman Sweeney is hopeful that the Court will affirm our position and reverse the District Court, since the Ninth Circuit already ruled that Plaintiffs were correct on this precise question in its prior ruling on the mandamus petition.
As of this date, 352 drivers have joined the lawsuit against Swift Transportation.
The case cannot move forward until the Ninth Circuit Court of Appeals determines whether District Judge Sedwick erred by sending this case to arbitration without deciding first whether the Plaintiffs are exempt from the Federal Arbitration Act. The appeal was fully briefed seven months ago on May 1st, 2012. The Ninth Circuit may take as long as it wishes, either to schedule argument or to decide the appeal without argument. Until then, we wait. Click here to read Plaintiffs’ opening Appeal Brief. Click here to read Defendants’ Response Brief. Click here to read Plaintiffs’ Reply brief. Getman Sweeney is hopeful that the Court will affirm our position and reverse the District Court, since the Circuit already ruled that Plaintiffs were correct on this precise question in its prior ruling on the mandamus petition. We now await the decision of the Ninth Circuit. The Court has not set a date for oral argument.
All briefing has been completed in the Ninth Circuit Court of Appeals on the question of whether the District Court erred by sending this case to arbitration without deciding first whether the Plaintiffs are exempt from the Federal Arbitration Act. Click here to read Plaintiffs’ opening Appeal Brief.Click here to read Defendants” Response.Click here to read Plaintiffs’ Reply Brief. We are hopeful that the Court will affirm our position and reverse the District Court, since the Circuit already ruled that Plaintiffs were correct on this precise question in its prior ruling on the mandamus petition. We now await the decision of the Ninth Circuit. The Court has not set a date for oral argument.
Getman Sweeney has prepared a short video about the status of this case, particularly addressing the pending appeal of Judge Sedwick’s decision to send this case to arbitration.
The 9th Circuit Court of Appeals has agreed to to permit an appeal of Judge Sedwick’s decision to send the case to arbitration. Plaintiffs are very happy that the Court has agreed to hear our appeal, as an earlier panel of the 9th Circuit has already ruled that the decision to send this case to arbitration to decide if the drivers were legally deemed independent contractors was in error. If the 9th Circuit reverses Judge Sedwick’s order sending the case to arbitration, a hearing will be held in the District Court to decide if the trucker plaintiffs in this case were treated as employees by Swift. Plaintiffs expect to argue that if Swift mis-treated the drivers as employees (while calling them independent contractors) drivers would be entitled to back pay for deductions, such as lease, insurance, tolls, gas, bonds, etc. and also be entitled to minimum wage for each week of work, as well as a variety of other damages.
Plaintiffs have asked the 9th Circuit to permit an appeal of Judge Sedwick’s decision to send the case to arbitration. (Sending the case to arbitration would likely result in denial of class certification and would be prohibitively expensive to bring on an individual basis). The matter is fully briefed and we are awaiting the decision of the Court.
Recognizing that the 9th Circuit’s opinion suggests that a District Judge and not an arbitrator must determine if the drivers in this case are employees, but disagreeing with that finding, Judge Sedwick has certified an appeal to the 9th Circuit on the question of whether the case can be sent to an arbitrator. Click here to review the District Court’s certification order. (321 ORDER that plaintiff’s motion at  is GRANTED i.pdf 38KB) Now the 9th Circuit must decide whether to hear the appeal. Because the case is not concluded, appeals are discretionary and must be approved by both the District Court and the Appeals Court. We expect that the 9th Circuit will agree to take the appeal.
The Ninth Circuit Court of Appeals issued a ruling today holding that a Court must determine whether the Federal Arbitration Act’s exemption for employees in interstate commerce applies to truck drivers such as the Plaintiffs in this case. Nevertheless, the Ninth Circuit refused to grant the mandamus petition and order the District Court to reverse the prior decision sending the case to arbitration. Thus, the Ninth Circuit affirmed the Plaintiffs’ legal position that the law requires a Court to decide whether the owner operators are “employees” exempt from the Federal Arbitration Act, but did not order the District Court to comply with that ruling. Click here to review the 9th Circuit’s decision. (15 Opinion Denying Mandamus.pdf 73KB) It may take a short period for the parties and the District Court to work out the effect of the decision, however, Plaintiffs are optimistic however, given that the Ninth Circuit affirmed our legal position. Further updates will be posted as the effect of this ruling and how it affects the parties’ positions becomes clear.
On July 25th, Plaintiffs filed a reply brief in support of their motion to lift the stay for arbitration. Click here to review Plaintiffs’ Reply Brief. (300 P. Reply to Response to Motion re  Motion.pdf 101KB) Defendants filed a motion requesting the opportunity to file a “sur-reply” and that motion was granted by the Court. After those papers are filed with the Court, the matter will await decision by the District Court.
Defendants have filed their opposition to the Plaintiffs’ motion to vacate the stay for arbitration. Click here to review the defendant’s papers. (287 D Opp to Pl. Motion to Vacate Stay.pdf 1MB) Plaintiffs will file a reply brief shortly.
The question of whether the District Court had the authority under the FAA to send this case to arbitration is now before the 9th Circuit for decision.
Plaintiffs have filed 57 separate arbitration demands with the American Arbitration Association for the issues presented in this case. The cases are in a legal limbo as the AAA recognizes that the arbitration clause drafted by Swift and IEL requires an arbitrator to determine whether the claimants are exempt from having to pay the filing fees. However the AAA will not administer the cases without the prepayment of filing fees. Plaintiffs continue to try to work this process out with the AAA.
The Court of Appeals for the Ninth Circuit has set oral argument on the Plaintiffs’ mandamus petition for Monday May 9, 2011 at 9 am. The argument will be handled by Edward Tuddenham for the Plaintiffs. The mandamus petition seeks the intervention by the 9th Circuit to direct District Judge Sedwick to hear the question of whether Plaintiffs are actually employees (under Section 1 of the Federal Arbitration Act) before sending the case to Arbitration.
On March 3, 2011, Plaintiffs filed reply papers in the 9th Circuit Court of Appeals in support of our petition for mandamus directing the District Court to hear the question of employment status before sending the case to arbitration (8 Petitioners reply to answer to Writ of Mandamus petition.pdf 74KB).
On February 23, 2011, Swift and IEL filed papers opposing Plaintiffs’ motion to the 9th Circuit Court of Appeals, in which Plaintiffs requested the Court to direct the District Court to consider whether the case is exempt from arbitration under Section 1 of the Federal Arbitration Act (FAA). Click here to review Swift’s opposition brief. (7-1 D Response to Writ of Mandamus of Real Parties In Interest.pdf 1MB) The Section 1 exemption to the FAA exempts “contracts of employment of … any other class of workers engaged in foreign or interstate commerce.” The question to be decided by the Court of Appeals is who must decide whether the ICOA is really a contract of employment, the District Court or the arbitrator.
The Ninth Circuit yesterday gave Plaintiffs good news when it ruled that the “petition for a writ of mandamus raises issues that warrant a response. (4 Order re Response to Mandamus.pdf 28KB)” A writ of mandamus is an “extraordinary remedy” and one that the Court does not generally grant. However, the Court’s ruling now indicates that the Court will seriously consider whether the District Judge erred in sending this case to arbitration. Under the terms of the Order, Swift and IEL, as well as the District Judge, are given 14 days to respond after which Plaintiffs will have 5 days to reply.
After Judge Sedwick denied Plaintiffs’ request to reconsider his decision referring this case to an arbitrator, and after his denial of Plaintiff’s request that he certify the issue to the 9th Circuit Court of Appeals, Plaintiffs continue to believe that the District Court erred by referring to the arbitrator the question of whether the case is exempt from arbitration under Section 1 of the Federal Arbitration Act. Plaintiffs continue to believe that the issue was wrongly decided, contrary to every decision to have considered the issue, and thus are today presenting the issue to the 9th Circuit Court of Appeals on a petition for mandamus. Click here to read a copy of the petition for mandamus. (final mandamus petition _2_.pdf 128KB) A Writ of Mandamus is an extraordinary writ that seeks to have a Court of Appeals correct error by a district court, even though no appeal is presently available. Although such writs are sparingly granted, Plaintiffs believe there are strong grounds for the 9th Circuit to hear the issue at this time.
Judge Sedwick denied Plaintiffs’ motion for reconsideration (229 ORDER FROM CHAMBERS denying Plaintiffs’ Motion for Reconsideration.pdf 13KB). After this order, Judge Sedwick denied Plaintiffs’ request that he certify the issue to the 9th Circuit Court of Appeals. Plaintiffs continue to believe that the District Court erred by referring to the arbitrator the question of whether the case is exempt from arbitration under Section 1 of the Federal Arbitration Act. Plaintiffs continue to believe that the issue was wrongly decided, contrary to every decision to have considered the issue, and are weighing and preparing their next actions in response.
Many owner operator drivers who have turned in their trucks, or who have had their trucks repossessed, have received debt collection notice letters from IEL or collection agencies working on its behalf (for example Partners Financial or ACRS). The letters claim that these drivers owe money.
Many drivers do not know why they owe money or they dispute the debt claim. In this case, Swift and IEL claim that they do not attempt to collect the full amount of unpaid lease payments. See the post above dated Monday, August 2, 2010 for fuller information. If you are being billed for the full amount of remaining lease payments, download and attach the declaration of Ms. Parrish in that post which states that IEL does not actually collect full remaining lease payments.
If you receive a letter informing you that you owe a debt, and you dispute this debt, you should know that under the Fair Debt Collection Practices Act, you may send the bill collector a letter that you dispute the debt. If you are already a plaintiff in this case, you may call us if you wish us to send the letter on your behalf. If you dispute the debt, the debt collector must cease collection efforts until the debt is verified. Click here to download a sample letter form to a debt collector, Swift or IEL. (billing dispute form.pdf 6KB) If you wish to send your own letter or are not a plaintiff in this case, please make sure you send the letter by certified mail, return receipt requested. Please also send us a copy of your letter.
This letter should state that you dispute the debt claim and request verification of the claim. Click here for a sample letter to use. When you dispute the debt and request validation, by law, the debt collector must verify the debt claim and must cease debt collection activities during this time period.
Plaintiffs have asked Judge Sedwick to reconsider his decision to send this case to arbitration. Specifically, Plaintiffs argue that the Court may only send a case to arbitration if either the Federal Arbitration Act (FAA), or the Arizona Arbitration Act (AAA) applies. We argue that the FAA does not apply because the Plaintiffs are really employees as a matter of law, and FAA section 1 exempts interstate transportation employees such as the Plaintiffs (and the AAA does not apply to employees). The Order compelling arbitration, sent to the arbitrator the question of whether the FAA applies. However, Plaintiffs argue that the question of whether Plaintiffs are employees (and thus whether the exemptions to the FAA and AAA apply) is thus an issue the Court must address first. Click here to review the Plaintiffs’ motion for reconsideration. (226 Motion for Reconsideration re Order on Motion to Certify Class.pdf 45KB) Reconsideration is not commonly granted, but in this case, Plaintiffs believe the Court overlooked clear law. Alternatively, Plaintiffs requested that the Court grant an immediate appeal. Furthermore, in accordance with the Court’s order compelling arbitration, on October 8, 2010, Plaintiffs have filed a demand for arbitration with the AAA on behalf of all Plaintiffs, including those who have already joined the case.
Judge Sedwick was considering three motions, Plaintiffs’ motion for permission to mail a collective action motion to all owner operators, Plaintiffs’ motion for a preliminary injunction, and Defendants’ motion to move the case to arbitration. Judge Sedwick did not rule on the Plaintiffs’ motions, but did rule that the case must go to arbitration.
In the motion, defendants Swift and IEL claimed that the arbitration clause which they inserted in the ICOA demands that the case go to arbitration before the American Arbitration Association (“AAA”). Plaintiffs objected, noting that the Lease agreement requires that claims be heard in Court. Plaintiffs pointed out that the claims arise primarily from the Lease or under both clauses, and since the clauses conflict, they must legally be considered against the party who drafted them. Plaintiffs also argued that the arbitration clause was unconscionable and the defendants had waived the argument through their litigation tactics.
Unfortunately, Judge Sedwick ruled that the Swift arbitration agreement compels all issues in this case to be heard by an arbitrator, rather than the Court. Click here to review the arbitration decision. (223 Order and Opinion Compelling Arbitration.pdf 60KB) Remarkably, Judge Sedwick entirely failed to address the primary argument advanced by the Plaintiffs, that is, that the arbitration clause in the ICOA was flatly contradicted by the clause in the Lease, strictly requiring the claims in this Case to be heard in Court. And to make matters worse, Judge Sedwick ruled in such a way that no appeal of his ruling is permitted, until after the arbitration occurs.
You should know that the conservative Supreme Court and previous conservative Congresses have, for the last two decades, increasingly made arbitration a priority for all employment and consumer cases, effectively allowing large and powerful companies the power to insulate themselves from lawsuits by cantankerous employees and consumers they have cheated. They and their teams of lawyers can simply remove the constitutional guarantee of a court or jury from those who would sue them. This secret removal of poor and middle income people’s legal rights has been accomplished far from the public limelight, as it is a technical issue that most people simply don’t understand and don’t pay attention to — that is until it happens to them. Along with this removal of the remedy of going to court, is the fact that “class action waivers” – clauses that companies write into the form agreements they have customers or employees sign which prohibit claims being brought as class actions, have frequently been held to be valid. Class actions allow employees to work together to gather evidence, and reduce costs by spreading the costs over a much larger group. The effect of these twin doctrines has been that employees and consumers are shunted into a forum favorable to the companies that support them and they are barred from taking action collectively. The net effect is that claims are far more difficult and expensive to bring, allowing the companies to avoid the normal legal consequences for their illegal behaviors. For more information on arbitration cases generally, see http://www.tlpj.org the website of a public interest law firm primarily working on arbitration issues.
This is a serious and negative ruling that makes many aspects of the case more difficult for us. As a general rule, the arbitration forum is considered more beneficial for large corporations for many reasons (indeed, that is why Swift demanded it in the ICOA). Among other things, it prevents employees from having access to much of the internal company documents that can be necessary to win their claims. Depositions of company officials may not be available, for example. But as with any procedural ruling at the start of the case, this ruling will be a two-edged sword that Plaintiffs can use as well. It is true that the ruling will create difficulties for Swift as well as the trucker Plaintiffs. There are significantly greater costs to arbitration for both the Plaintiffs and Swift. And all of these costs will ultimately be borne by Swift if the arbitrator rules for Plaintiffs.
Also, on the plus side for Plaintiffs, arbitration is a much more streamlined process and Swift is unlikely to be able to tie up the litigation for long periods of “discovery” in which they would be able to depose and question truckers for months or years before trial.
The Plaintiffs’ legal team will be carefully analyzing the ruling and our next steps this week as we prepare for the arbitration. We will post further updates shortly to let you know just how we intend to use this ruling to ultimately prevail and force Swift to comply with the law.
While we are very disappointed in this ruling, which we consider to be completely incorrect, this is a very preliminary ruling which may also turn out to help us further down the road.
In order to argue against Plaintiffs’ motion for a preliminary injunction barring Swift and IEL’s collections for the full amount of the remaining lease payments following their putting a driver in “default” status, Swift has filed a remarkable affidavit, stating that Defendants will demand the full remaining lease payments in its demand from drivers, but will not, in fact, seek all remaining payments. Elizabeth Parrish has filed an affidavit stating that a “lessee [in default] is responsible only for costs incurred by IEL in preparing the truck for re-lease, and any lease payments missed prior to the re-lease or sale of the truck.” See Paragraph 9. Click here to review the Parrish affidavit. (175 Declaration of Elizabeth Parrish 172 Response to Motion.pdf 297KB) Thus Swift and IEL are admitting that they overbill drivers, but stating that they will not actually pursue such overbilled amounts. Drivers who received demands for all remaining Lease payments following a “default” should show this Parrish affidavit to any collections agency or credit reporting agency. Further, please let Getman Sweeney know if you have been overbilled by defendants, or threatened with the higher charges.
Swift has filed its opposition to Plaintiffs’ motion for a Preliminary Injunction. Our motion seeks to stop Lease collections efforts against truckers until the Court determines if the Lease is lawful. We also seek to stop any negative reporting to DAC or DriverFACTS. We also seek to stop Swift from making mid-term changes disadvantageous to drivers to the ICOA contract. Click here to review Swift and IEL’s response to our motion. (172 D Response to P Motion for PI.pdf 125KB) Drivers who have information contrary to the claims raised by Swift are urged to call Getman Sweeney and speak with Janice or Kathy. On July 21st, the Court extended Plaintiffs deadline to file reply papers on the motion to August 3, 2010.
4) mid-contract changes demanded by Swift or IEL under threat of having the truck repossessed or the driver put on safety hold until a signature is given.
If this happened to you and you have such proof, please contact paralegals Janice Pickering or Kathy Weiss (845)255-9370 to discuss.
On May 11th, Plaintiffs made a motion to certify the Fair Labor Standards Act minimum wage claims in this case as a “collective action.” The motion seeks court approval to mail a notice of the case to all class members, advising them of their rights to join the case. Click here to read the Plaintiffs’ motion papers. (108 MOTION to Certify Class.pdf 124KB) Of course, individual truckers who leased a truck from IEL and drove for Swift are permitted to raise FLSA claims now by filing the Consent to Sue form which is posted at the top of this web page.
Defendants have already contacted the Court’s chambers to request information from the Court on how to delay all briefing on the plaintiffs’ motion while defendants get their motion to send the case to arbitration ready, which is due by May 25, 2010. Judge Sedwick’s chambers would not address that request unless defendants make it in motion form, which is expected shortly.
The attorneys are interested in speaking with FORMER driver managers and other FORMER Swift and IEL management (including recruiters for IEL) to learn the details of how Swift and IEL’s operations worked from the perspective of those inside the companies. FORMER employees are encouraged to call Getman & Sweeney and ask to speak with Dan Getman or Carol Richman. ALSO, DRIVERS WHO HAVE CONTACT INFORMATION (SUCH AS NAME, TELEPHONE # OR ADDRESS) FOR FORMER MANAGEMENT EMPLOYEES OF SWIFT AND IEL ARE ENCOURAGED TO CALL JANICE PICKERING OR KATHY WEISS TO GIVE CONTACT INFORMATION.
On April 5th, Judge Berman transferred venue in the case to the U.S. District Court for the District of Arizona. Judge Berman found that most of the events involved in the suit emanate from Arizona and that therefor the suit should be transferred. The pending motion for a preliminary injunction will be refiled in Arizona. All individuals who filed consents to sue in the case remain in the case in Arizona. Although we hoped Judge Berman would keep the case, venue transfer motions are easy ones for defendants to win. Although the case is venued in Arizona, the case was assigned to a Judge from Alaska, the Honorable John W. Sedwick. A Magistrate Judge has not yet been assigned.
Judge Berman has set a Court conference for April 5, 2010 at 9:30 a.m. in his Courtroom at the U.S. District Court in Manhattan to discuss the pending motions (transfer of venue, arbitration).
Swift is routing certain owner operator drivers to select terminals to meet with its lawyers. No person who has joined this lawsuit by filing a consent to sue should participate in such a meeting without the presence of a lawyer from Getman Sweeney. And we believe that no driver should be forced to participate in this meeting. If a driver participates in such a meeting, he or she should request a copy of any papers that they are asked to sign. Getman Sweeney would like to speak with any participants in the meetings who would care to discuss what occurs.
Plaintiffs have amended the complaint to raise claims under the federal “Forced Labor” statute, 18 U.S.C. §1589 and 1595, and to make various other claims in the case. Click here to review the Second Amended Complaint. (2nd amended stamped.pdf 946KB) Defendants have not yet answered the complaint, as their motion to transfer venue allows them to avoid this requirement for the time being.
On March 3, 2010, defendants filed their reply papers asking Judge Berman to transfer the case to Arizona. Click here to see Swift and IEL’s reply. (2.22 Def Letter Reply re Venue.pdf 354KB) The matter now sits with Judge Berman. We have filed discovery demands asking Swift and IEL to provide documents we believe will be primary evidence in the case. Plaintiffs have also served a subpoena on QualComm to obtain evidence of instructions (demonstrating control) that Swift or IEL sends drivers considered to be owner operators.
On February 23rd, we filed an opposition to the transfer of venue. Click here to review our letter brief. (FINAL Letter Brief Opposing Transfer.pdf 70KB) Any truckers interested in seeing the 90 pages of exhibits that were attached to the Court filing should contact Getman Sweeney for a copy.
A brief initial conference was held by U.S. District Judge Richard M. Berman in this case. Defendants also asked the Court to permit them to make a motion to transfer venue of the case to Arizona — that is to seek home field advantage. Click here to review Defendants’ Letter Brief requesting transfer of the case to Arizona. (Def. letter mot to dismiss.pdf 88KB) Judge Berman accepted defendants letter as the motion to transfer venue and asked plaintiffs to respond. This tactic was fully expected. Plaintiffs will serve their reply letter brief to the Court by Wednesday, February 24, 2010.
Any truckers who are part of this case, or who are considering whether to join this case, are welcome to stop by Getman Sweeney to discuss the case and your individual facts. We are located immediately next to New York Thruway Exit 18, which has ample truck parking just at the toll plaza. Please let Janice Pickering know, in advance if possible, if you might be stopping by and we can pick you up at the toll plaza. Paradies Lane, where our office is located, is a spur and does not have room to turn around a trailer.
The initial scheduling conference has been set by Judge Berman for February 17, 2010 at 9 am in courtroom 21B of the U.S. District Court, 500 Pearl Street, New York, New York 10007-1312. While scheduling conferences are not generally attended by clients and at times can be short and uninteresting, any truckers who are interested in this case are welcome to be present.
Plaintiffs have amended the complaint to add an additional named plaintiff and to clarify the claims brought in this case. Click here to see the First Amended Complaint. (17 frist amended cplt.pdf 869KB) Defendants have not yet “answered” the complaint.
Dan Getman, the attorney for the plaintiffs in this case will be speaking about the Swift case with Evan Lockridge on his show the Lockridge Report, Thursday, February 11, 2010, on Sirius XM Satellite Radio’s Road Dog Trucking channel 147 (the Lockridge Report airs weekdays 2 pm eastern/1 pm central).
The lawsuit claims that Swift and IEL treated the truckers who leased trucks through IEL as “independent contractors” when they were really employees of Swift AS A MATTER OF LAW. As such, Swift and IEL failed to pay all the wages due, and made unlawful deductions from truckers’ pay for truck lease payments, gas, equipment, maintenance, insurance, tolls, Qualcomm, and bonding, etc. The case raises class action claims under the law of contract, and under various state laws which also protect workers from unlawful deductions (so far, the state laws of New York and California, however additional state statutes will apply to workers in other states). The case also raises claims that the ICOA and lease are unconscionable in that Swift can terminate the lease for any reason at all, then continue to demand that all lease payments (including profit to Swift) continue to be made. Other grounds for unconscionability include the imposition of liquidated damages and the mischaracterization of employees as independent contractors.
Under the federal minimum wage law, back pay and an equal amount of liquidated damages are claimed for each violation. Under the law of contract, plaintiffs seek to declare the contracts void or voidable for unconscionability. In addition, under wage protections statutes, plaintiffs seek to compel Swift to reimburse truckers for the various deductions from their pay, including truck lease, insurance, gas, tolls, maintenance, etc. In addition, plaintiffs seek to compel reimbursement for additional employer expenses borne by truckers.
Generally claims can be made at least for the three years preceding the date the complaint was filed. You are entitled to file FLSA claims (using the Consent to Sue form) for the period extending back three years from the date you file the form. State statutory and contract claims have different limitation periods (six in NY, four in CA). Other states have different limitation periods. Please call if your lease ended over three years ago and you wish to join the case.
Can SWIFT or IEL fire me or take action against me for joining the lawsuit?
The law prohibits retaliation for joining a pay lawsuit. If any employee suffered retaliation, Swift and IEL would be liable for double the injury caused by retaliation against an employee. Notify us immediately if you hear of any threats of retaliation or if you think any retaliation occurs. Retaliation is extremely rare in overtime cases, because an employer can suffer such serious penalties.
Past and present truckers driving for Swift as “owner operators” anywhere in the U.S. may be included in this lawsuit.

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