A Defense Department subcontractor was ordered on Wednesday to release dozens of servicemembers’ and civilians’ vehicles seized in a financial dispute between the subcontractor and its partner company.
A U.S. District Court judge ordered Liberty Global Logistics, based in Lake Success, N.Y., to release 66 vehicles held as a lien against more than $3.6 million the company claimed it was owed by International Auto Logistics, the Defense Department’s contractor responsible for shipping Defense Department employees’ vehicles.
Liberty is also enjoined from seizing any more vehicles unless given permission by the court.
Liberty seized the vehicles on Dec. 11 after it claimed International stopped making payments on “undisputed ocean freight,” according to court documents. The company also claimed — in a document opposing International’s motion — that International owed almost $20 million in other fees
International argued the two companies had been in negotiations and the seizure was nothing more than “self-help thuggery.”
International and Liberty have had disputes about money reaching back to at least September, with Liberty citing a lack of payment and International arguing it was not receiving adequate shipping information to pay bills. Wednesday’s order requires International to pay ocean freight bills “that the parties have agreed are due and owing through Friday” to Liberty. International must also stay current on all future charges on a weekly basis and Liberty must provide “appropriate and adequate billing support.”
Liberty hopes to have “virtually all” vehicles they ship for International “to the final port of discharge by early January,” said Robert G. Wellner, executive vice president of Liberty, in an e-mail on Thursday.
The judge ordered both sides to settle any outstanding issues by arbitration.
International has faced heavy criticism for the late delivery of vehicles and failure to provide accurate tracking information.