XPO Sues YRC Freight for Allegedly Conspiring to Steal Trade Secrets - Global Trade Magazine
  February 18th, 2016 | Written by

XPO Sues YRC Freight for Allegedly Conspiring to Steal Trade Secrets

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  • XPO law suit demands that YRC be restrained from employing seven former XPO Freight executives for a year.
  • XPO complaint alleges that executives resigned from XPO and immediately went to work at YRC.
  • The legal issue involved in XPO action against YRC is whether executives had access to sensitive information.

XPO Logistics Freight has brought a law suit against YRC Freight, the less-than-truckload (LTL) unit of YRC Worldwide Inc., alleging a scheme to steal XPO Freight employees and misappropriate its competitor’s trade secrets, news outlets have reported.

The suit, filed in a Delaware court, demanded that YRC be restrained from employing seven former XPO Freight executives for a year. The employees in question include Chet Richardson, who ran Con-way Freight’s line-haul operation, and Paul Lorensen, who headed Conway’s regional operations.

XPO Logistics Freight was known as Con-way Freight before XPO Logistics bought Con-way’s parent company for $3 billion in October 2015.

The complaint alleges that both executives resigned from XPO on November 9 and went to work at YRC, in positions similar to those they held at Con-way. YRC announced their appointments on January 26, 2016.

The legal issue involved with the resignations and hirings is that the executives presumably had access to sensitive XPO information, which they took with them to their new employer.

The complaint also alleges that Lorensen was hired by YRC first and was encouraged by his new employer to persuade Richardson to follow suit. Richardson allegedly had access to proprietary route selection software models.

The complaint also charged that YRC Freight executives conspired with Lorensen and Richardson to try and poach other XPO Freight employees for strategic reasons, including, according to the complaint, “for their knowledge of [XPO] confidential information and trade secrets.”

YRC Freight and its parent company have declined to comment on the law suit.