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Four years ago, United Parcel Service asked Larry Jones, an employee of its tire service vendor, to come to its Hollywood, Fla., package center for a meeting on his day off. When he arrived, three UPS security guards accused him of stealing tires from company delivery trucks. He ended up signing a confession in which he admitted to stealing two to four tires a week over several years. That confession led to his employer, Lynn Strickland Tire Inc. of Miami, owned by Harold Decker and James Preston Trammel, losing its contract with UPS and ultimately going out of business. It also triggered a set of multimillion-dollar suits and countersuits, which recently went to trial in U.S. District Court in Miami. The case involved UPS; Strickland Tire, which serviced UPS’ fleet of 2,000 trucks in South Florida; and Bandag, a Muscatine, Iowa, rubber, tire and retread manufacturer that contracted with Strickland to provide services to UPS. A jury reached a verdict late last month, but none of the parties was happy with the outcome. “Harold Decker was devastated,” says Chris Wintter of Wintter & Associates of Hollywood, who served as attorney for Strickland Tire. “That business was his baby.” Even though the jury found nominally for UPS, Dan McMackin, an Atlanta-based spokesman for the delivery company, says UPS disagreed strongly with the verdict. “We do not consider this issue settled. We’re very disappointed.” According to court records, Bandag signed an agreement with UPS in 1993 to retread and replace all tires on the delivery company’s trucks in Southwest and Southeast Florida. Strickland was the registered franchisee for Bandag in South Florida. Strickland employees would travel every day to UPS package centers in South Florida to inspect, repair and replace tires on the company’s delivery trucks. UPS says in its complaint that in early 1997, it discovered a scheme by one or more employees of Strickland Tire to steal the company’s tires. The company says one of its security guards observed Jones stealing a tire, according to the suit. UPS says it then did an inventory of its tires and discovered that 10,000 were missing. Strickland Tire tells a different story. In an interview, Wintter said that UPS was supposed to keep track of its own tires, but failed to do so. Then, Wintter said, the delivery giant said 10,000 of its tires were missing or stolen — an impossibly high number — and blamed Strickland Tire for the alleged losses. “Strickland had only provided them with 11,000 tires total during the previous five years,” says Wintter. Wintter also says that UPS’ allegations against Jones were exaggerated. He notes that Jones eventually pleaded no contest to the charge that he stole 10 tires, and was ordered to pay restitution of $2,679. UPS’ biggest mistake, Wintter says, was the way it handled its complaints about Strickland. Instead of going directly to the service provider and raising these issues, UPS went straight to Bandag and urged the rubber company to drop Strickland as a franchisee. (Bandag’s lawyer, Sean Santini, a partner at Aragon Burlington Weil & Crockett in Miami, denies this; UPS refuses to comment on the specifics of the case.) Bandag initially refused to drop Strickland Tire, Wintter says. But UPS didn’t stop there, he says. He alleges that UPS stopped doing business with two other Bandag franchisees in Florida and threatened to cancel its entire $20 million-a-year national contract with the company — which Santini corroborates. Then, in 1998, UPS filed suit against Strickland Tire and Bandag, alleging that Strickland committed conversion — theft — and breached its contract by, among other things, not properly accounting for UPS’ tires. Ultimately, Bandag did drop Strickland because the franchisee “did nothing to prevent the perception of theft,” Santini says. “It was hurting our reputation.” Strickland lined up another supplier for the special rubber used to retread tires. But after 13 years in business, Strickland closed its doors in April 1999. Strickland then countersued UPS for tortious interference, for allegedly causing Bandag to terminate its contract with Strickland. It also sued Bandag for wrongful termination of the contract. Bandag, in turn, sued Strickland Tire for common law indemnification, in case Bandag had to pay damages to UPS. UPS settled its suit against Bandag. The rubber company agreed to pay the delivery firm $750,000, including $300,000 in cash and discounts for future business. As to the rest of the litigation, the jury, after a two-week trial, decided in favor of UPS’ breach of contract and conversion claim. But it also found that UPS committed tortious interference. It did not find, however, that Bandag wrongfully terminated Strickland Tire’s contract. Even though they found in favor of UPS, the jurors showed little sympathy for the delivery giant. UPS had asked for $11 million in damages from Strickland Tire. The jurors awarded UPS a measly dollar. Strickland had sought $4.2 million in compensatory damages from UPS for the loss of the business, plus punitive damages. Instead, the jury awarded Strickland $600,000 in compensatory and $550,000 in punitive damages. Out of that, however, the jury found that Strickland owed $300,000 to Bandag to compensate the rubber company for the settlement it paid to UPS. UPS is considering an appeal. Wintter, Strickland Tire’s lawyer, says he’ll wait until Judge Paul Huck enters his final judgment before deciding whether to ask for a new trial or make any other motions. The now-defunct tire service company can’t appeal, since it technically won the case.

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