Pilot Flying J Ripples

Tests, rejects "Rebate Education" website as scandal touches business, sports, politics

Greg Lindenberg, Editor, CSP

KNOXVILLE, Tenn. -- Pilot Flying J has taken down a website that it launched over the Independence Day holiday weekend to keep customers, the press and employees informed about the ongoing investigation into the trucking company fuel rebate scandal that went public with a high-profile FBI and IRS raid on the truckstop and travel center company's Knoxville, Tenn., headquarters on April 15.

"Pilot Flying J considered and tested a microsite as a communication tool, but decided there were other, more effective means of communicating directly with employees, customers and vendors," Pilot Flying J spokesperson Lauren Christ said in a statement provided to CSP Daily News concerning the "Rebate Education" site. The site is no longer accessible.

Nearly 20 lawsuits have been filed as result of the investigation. WBIR-TV in Knoxville has posted a list and map detailing the lawsuits.

Meanwhile, the scandal continues to send ripples through business, sports and politics.

A spokesperson for the Cleveland Browns, owned by Pilot Flying J president and CEO Jimmy Haslam, said that Haslam has no plans to sell the football franchise because of Pilot Flying J's legal issues, said an Associated Press report. In a story published Sunday on the ESPN Cleveland website, Haslam said he intends to own the Browns "for a long time."

And in a statement issued Monday to AP, Pilot Flying J spokesperson Tom Ingram said, "We expect no change in Mr. Haslam's relationship with the NFL and/or his ownership of the Browns."

Also, Tennessee Governor Bill Haslam, brother to Jimmy Haslam, has struggled almost from the start of his administration to fulfill a campaign pledge to avoid handling matters relating to Pilot Flying J, said the news agency. AP said that the investigation of alleged fraud has brought increased scrutiny of the company and raised more questions about links between the governor and Pilot.

Haslam's connections to Pilot were a central theme in the 2010 Republican primary and general election. Opponents attacked Haslam for refusing to disclose his personal ownership stake in the company, hammered the company for price gouging settlements after gasoline shortages caused by a hurricane and derided the candidate as a billionaire oil man who would do the bidding of his father, Pilot founder Jim Haslam, and brother, Jimmy, the company's CEO, if elected.

The Haslam campaign rebutted those attacks largely by citing Pilot's "history of operating with integrity" and by criticizing "smears about a home-grown successful company."

Those blanket dismissals will be harder to make in the future as the company grapples with fallout from the raid by federal agents and subsequent guilty pleas of five Pilot employees, said AP.

Haslam's chief campaign strategist was Tom Ingram, who has remained a paid adviser since the election while orchestrating Pilot's public response to the FBI raid. Ingram, who also lobbies state government on behalf of other private clients such as the mining company seeking to extract coal from public lands, has said he doesn't lobby the governor directly.

As he persevered in a tough GOP primary and trounced his Democratic opponent in the 2010 general election, Haslam promised that he wouldn't participate directly in government matters relating to Pilot. That pledge faced an early test in the governor's first year in office over a decision to request a federal waiver on gasoline standards after an explosion at the Valero refinery in Memphis, which was Pilot's largest fuel supplier in the area. Haslam acknowledged that he had spoken to his brother about earlier problems at the refinery but said he had delegated that decision to his deputy, Claude Ramsey. The state ultimately requested and was later granted permission by the U.S. Environmental Protection Agency to relax fuel standards.

A month later, Haslam endorsed his brother's right to speak out in a letter to the governor and other state officials against privatizing state-run rest stops along interstate highways.

"He's the CEO of a major Tennessee business that has their interests to defend," Haslam said. "And that's nothing new: Pilot's been talking about that, as has everybody else that has an interstate business--from McDonald's to everybody--else for years."

The governor has maintained that he has had no active role in Pilot since leaving the company to run for Knoxville mayor in 2003. But his family continues to own a majority share in the privately held company with annual revenues of $31 billion, and Haslam has kept his personal share outside of a blind trust established for his other investments.

Click here to read the full AP report.