When the freight broker Convoy went into bankruptcy, apparently they walked away from paying many truckers for loads already carried. The individual claims weren’t too large, and as creditors they would be far down the line in a bankruptcy proceeding.
Quite a few of the truckers were carrying for IKEA, the giant home goods retailers. The estimate is somewhere around $500K owed to truckers for loads brokered by Convoy.
But IKEA doesn’t know whom to pay. Its contract says to pay Convoy, but only after Convoy has paid the truckers. The carriers were forbidden by the contract they signed from invoicing IKEA.
Apparently Hercules Capital has secured an interest in Convly’s assets including the accounts receivable as part of a financing deal. Hercules Capital has tried to invoice IKEA for $519,254 in transportation costs. But they haven’t agreed to pay the carriers, let alone done so.
To its credit IKEA placed the funds in care of the court. It has asked to be exonerated, and will allow the court to decide which truckers should be paid. But the wheels of bankruptcy grind slowly, and in the meantime, the truckers don’t have their money.
It’s an unpleasant situation for the truckers. I hope the court can address their concerns promptly.
By Alex Lennane 27/02/2024
IKEA asks courts to intervene as Convoy’s unpaid truckers send flurry of invoices
Supply Chain and Logistics 