FedEx Corp has severed its relationship with one of its largest delivery contractors effective immediately.
The package delivery company sued, asking a federal judge to stop the contractor from spreading misinformation about his business for profit.
Spencer Patton has 225 FedEx Ground Routes in 10 states as well as companies that provide services to the approximately 6,000 U.S. contractors who transport and deliver packages for this unit.
Patton has said for weeks that up to 35% of FedEx Ground delivery providers are at risk of financial failure. He urged his executives to improve pay and rallied “his peers to his cause”.
“Really, what I’ve been advocating for and what I’ve really made the public aware of is that we’re in tremendous financial distress,” Patton, founder and president of Route Consultant, told FOX’s Dagen McDowell. Business on “Mornings with Mariain an interview earlier this month.
“We’ve seen our fuel prices double in a year. We’ve seen our wage rates go up, our vehicle costs go up,” Patton said at the time. “And I’m sounding the alarm that the risk of network disruption in FedEx Ground is higher than I’ve ever seen.
FedEx’s lawsuit seeks injunctive relief and damages as part of a “coordinated and multi-faceted campaign orchestrated” by Patton.
Not to mention the case, Patton went public with the termination of his relationship with FedEx, saying that “the company’s decision to cancel our contracts is a clear case of (this) silencing anyone with a voice.”
FedEx said the affected routes represent less than 0.5% of Ground’s 60,000 routes and that contingency plans are in place.
In his trial, FedEx alleged that Patton disparaged its Ground business through a series of false and misleading statements about its business activities.
In the lawsuit, FedEx alleged that adverse media coverage stemming from Patton’s campaign could damage Ground’s reputation with shippers who pay it to deliver packages and erode goodwill within the contractor network.
FedEx alleged that Patton’s actions are a promotional campaign for his company which provides consulting, brokerage and other services to delivery providers.
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And, the company said, Patton indirectly encouraged actions that could disrupt its crucial Christmas delivery business.
At a conference held by his company last weekend, Patton said that if the terms of his contract were not adjusted, he would close his FedEx Ground contracting business on November 25, at the start of the season. holidays.
Kristen Altus of FOX Business and Reuters contributed to this report.