Omni alleges Forward CEO withheld, destroyed requested docs

A letter to a Delaware court overseeing a dispute between potential merger mates Forward Air and Omni Logistics says Forward and its CEO, Tom Schmitt, “wrongfully withheld” requested documents from board meetings discussing the transaction.

“In short, it is not credible that after two custodial interviews, a motion to compel, and a partial production of calendar entries in response to that motion, Mr. Schmitt was under any misimpression that his cache of highly relevant notes was not required to be collected for counsel’s review and produced,” a Dec. 20 letter from Omni’s counsel to the Delaware Court of Chancery stated.

It said the documents were provided just hours after Schmitt submitted a court-ordered “note taking and destroying practices” affidavit and that some items continued to be destroyed after he was instructed not to.

“We also do not accept Mr. Schmitt’s claims about the daily destruction of his daily calendar entries, which, by his own admission, continued after he received a litigation hold notice,” the letter said. “That daily destruction of documents continued through a critical period in which Mr. Schmitt participated in regular board meetings and discussions about the transaction and plans to avoid the transaction.”

All told, more than 1,300 pages of Schmitt’s handwritten notes and other items pertaining to the merger have been handed over to Omni.

Forward (NASDAQ: FWRD) announced in August plans to merge with freight forwarder Omni in a deal initially valuing the company at $3.2 billion. The boards of both companies approved the transaction, but some of Forward’s shareholders were rankled as the deal structure didn’t require their approval ahead of closing.

Source: freightwaves.com