Another California business has gone under. I wonder what place the cost of diesel fuel and the impending Newsom demand to get rid of diesel trucks, to be replaced by electric trucks played in this?
Expect many more freight companies to go under—that seems to be the goal of President Newsom.
Shuttered California LTL carrier files for bankruptcy
Owner John Ohle hopes to restart Tony’s Express with ‘rental’ business model
Clarissa Hawes, Freightwaves, 6/27/24 https://www.freightwaves.com/news/shuttered-california-ltl-carrier-files-for-bankruptcy
Less-than-truckload carrier Tony’s Express of Fontana, California, has filed for bankruptcy protection, nearly three months after it abruptly ceased operations by notifying around 200 truck drivers, warehouse workers and office personnel via text message that they no longer had jobs.
John H. Ohle, president and sole shareholder of Tony’s Express, bought the company in May 2023 from brothers Anthony “Tony” Raluy and George Raluy. Their father started the business in 1954.
Less than a year after acquiring Tony’s Express, Ohle shuttered operations of the 70-year-old carrier by sending workers a text message on March 28. The message, which was obtained by FreightWaves, notified employees that the company was closing its doors that day and could not cover the previous week’s payroll or workers’ paid time off.
“The current market just didn’t support our ability to operate and be a profitable company, and the cost of fuel in California made it very difficult,” Ohle told FreightWaves a few days after the closure. “We were in very serious discussions with two different companies about coming in and partnering or taking over Tony’s, and those fell apart at the very end, and literally, it was a last-minute decision.”
Drivers and workers did receive their final paychecks on April 29 but told FreightWaves that fees for health and life insurance, which they no longer had, were deducted from their pay.
Tony’s Express filed a Chapter 11 bankruptcy petition Friday in the U.S. Bankruptcy Court for the Central District of California. The company is filing its petition under subchapter V, which provides a path for small businesses seeking to reorganize.
As of publication time, Ohle and his bankruptcy attorney, Eve H. Karasik, had not responded to FreightWaves’ request seeking comment.
The filing for Tony’s Express lists both its assets and liabilities as up to $10 million. The company states that it has up to 199 creditors and that funds will be available for distribution to unsecured creditors.
The company’s top three creditors with unsecured claims are located in California, including Y Trucking of Fontana, which is owed $700,000. The company’s address used in the filing is the same one for Tony’s Express. Royal Hawaiian Express of Fullerton is owed more than $560,000, and Centerline Drivers LLC of Santa Ana is owed nearly $354,000.
According to its petition, Tony’s Express is disputing all of its 20 largest unsecured creditors’ claims.
Ohle plans to restart Tony’s as ‘rental’ truck trailer business
On Tuesday, U.S. Bankruptcy Judge Vincent P. Zurzolo granted Tony’s Express’ motion to extend the deadline to submit its schedules of assets and liabilities as well as the company’s statement of financial affairs (SOFA) with the court.
In his motion to the judge seeking a deadline extension, Ohle stated that he needed more time to file the schedules and SOFA because he “has been addressing several critical issues, including preparing the initial filing [and] negotiating DIP [debtor-in-possession] financing with eCapital.”
Ohle added that he is also “working on plans to restart [Tony’s Express] with a ‘rental’ business model for its fleet of over 250 trucktrailers.”
The company has limited personnel, and Ohle is the only one “handling bankruptcy matters alongside other commitments.” The motion also says Ohle’s “financial situation is complex, including a $1 million projected loss for 2023 and $4.5 million [to] $5 million in unsecured liabilities, which requires careful analysis and reporting.”
Zurzolo has set a creditors’ meeting for July 12, and the proof of claims deadline is scheduled for Aug. 29. A status conference with the subchapter V trustee is set for Aug. 15, and Ohle must file a status report with the court by Aug. 1.
Name change
After shuttering Tony’s Express, Ohle recently changed the intrastate carrier’s name to that of another business formerly owned by the Raluys — Economy Packaging Inc. — and has moved the business from Fontana to Pomona, California.
Founded in 1971 by the Raluys, the brothers describe Economy Packaging as a packaging and household products storage facility, according to the business entity search on the California secretary of state’s database.
However, the Raluys didn’t update Economy Packaging’s business filing to add Ohle’s name as the new owner or list him an officer of the company — its last filing update was in September 2021, although Anthony Raluy did update Tony’s Express’ business filing to add Ohle as CEO, CFO and secretary of Tony’s Express in April 2023.
The same month that Ohle acquired Tony’s Express in May 2023, he used the carrier’s DOT number to open a small trucking firm and brokerage in Joliet, Illinois. However, the Federal Motor Carrier Safety Administration SAFER website shows that its common carrier operating authority was involuntarily revoked on May 7, 2024.
The company’s surety bond coverage for its brokerage was canceled Saturday, the day after Tony’s Express filed for bankruptcy. According to FMCSA data, Tony’s is “not authorized to operate as [a] property broker.”
