Federal Prosecutors Seek to Dismiss Charges Against Pilot Flying J Executives
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Citing limited government resources and witness credibility problems, federal prosecutors have asked a federal judge to dismiss criminal charges against former Pilot Flying J President Mark Hazelwood and two other former company executives, all of whom were scheduled to be retried early next year on charges related to a massive diesel fuel rebate scheme.
Hazelwood, former Pilot Vice President Scott Wombold and former Pilot account representative Heather Jones were convicted by a Tennessee jury in 2018 in connection with a multimillion-dollar fraud scheme to siphon fuel rebates away from thousands of truckers.
But a听federal appellate court in October overturned the convictions on the grounds that a lower federal court permitted use of evidence that should not have been admitted.
Former Pilot Flying J President Mark Hazelwood shown with his wife, Joanne, in September 2018. (Caitie McMekin/Knoxville News Sentinel)
In their July 27 motion to dismiss the 8-year-old case, prosecutors said, 鈥淭he government has determined that a retrial in this case will require the testimony of cooperator whose personal circumstances cause the government to conclude that it would be inappropriate to compel her testimony, and, in any event, prevent the government from being confident in the reliability of that witness鈥 recollection of significant facts and circumstances.鈥
鈥淭he government seeks this leave in good faith, that is with no intention of engaging in a 鈥榩rosecutorial harassment鈥 scheme through a pattern of dismissal and recharging,鈥 the motion said. 鈥淚n that vein, the government consents to dismissal with prejudice.鈥
Senior U.S. District Court Judge Curtis Collier of Chattanooga must approve the dismissal for it to become effective.
Since October, attorneys for the executives and federal prosecutors have been sparring via court documents over the evidence and the impact of the appellate court overturning the case.
In reversing the convictions last year, the U.S. 6th Circuit Court of Appeals remanded the case to the district court for a new trial. In May, attorneys for the three executives asked a Chattanooga, Tenn. federal judge for a change of venue to another state for that planned retrial. With the prosecutors鈥 request for dismissal, that retrial is now shelved.
The appeals court said the federal district court wrongly admitted recordings of Hazelwood using 鈥渄eeply offensive racist and misogynistic language鈥 on the theory that if Hazelwood was 鈥渞eckless enough to use language that could risk public outrage against the company, he was a 鈥榖ad businessman,鈥 and as a bad businessman, he was also reckless enough to commit fraud.鈥
In a related affidavit also filed in May, Hazelwood asked Collier to recuse himself from the retrial, saying his actions during the trial were biased and that allowing the recordings to be heard by the jury showed that 鈥渁 reasonable person, if aware of all the relevant circumstances, might question the court鈥檚 impartiality.鈥
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The case against the three executives and others began with a raid on Pilot鈥檚 headquarters in Knoxville, Tenn. More than 50 FBI and IRS agents poured into the company鈥檚 three-story offices on the afternoon of April 15, 2013.
Prior to Hazelwood鈥檚 trial, 14 former Pilot sales executives had been charged, pleaded guilty and agreed to cooperate with the government while awaiting sentencing.听Hazelwood originally was sentenced to 12陆 years in prison and fined $750,000.
Pilot already has paid the federal government a $92 million penalty to take responsibility for the criminal actions of the employees involved, but the agreement did not preclude individual prosecutions.
In November 2013, a federal judge in Arkansas approved an $84.9 million settlement offer from Pilot to reimburse as many as 5,500 customers included in a class-action lawsuit against the company.
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