Wednesday, September 7, 2016

Judge makes $120M ruling against Citgo in massive 2004 Delaware River spill for failing its duty to provide "safe berth warranty" to the Athos I tanker



Judge makes $120M ruling against Citgo in massive 2004 Delaware River spill Updated: September 7, 2016 — 7:53 AM EDT



  David Swanson / Staff Photographer The Athos I spilled 264,000 gallons of oil in the Delaware River in November 2004 after striking a submerged ship anchor. The spill affected hundreds of miles of shoreline.

 

by Linda Loyd, Staff Writer @LoydLinda

After 12 years, three trials, and 70 days of court testimony, a federal district judge in Philadelphia has ruled in favor of the Greek owners and operators of the oil tanker Athos I, which struck an anchor in the Delaware River in November 2004 as it nudged toward the Citgo refinery dock in Paulsboro.

 
Judge Joel H. Slomsky in a 173-page opinion in late July and a final order Aug. 17 ruled that Citgo, the refinery operator, had failed its duty to provide "safe berth warranty" to the Athos I tanker sailing from Puerto Miranda, Vene
Slomsky ordered Citgo Asphalt Refining Co. to pay Frescati Shipping Co., the ship owner, and Tsakos Shipping & Trading, the ship operator, $55.5 million plus $16 million in interest for a total of $71.5 million. The judge ordered Citgo to pay about half of the federal government's costs for the spill cleanup, or $48.6 million.

Citgo has filed a notice to appeal the ruling to the U.S. Third Circuit Court of Appeals in Philadelphia.

A submerged rusty ship anchor punctured the hull of the Athos I, causing 264,000 gallons of oil to spill, and affecting hundreds of miles of shoreline. The Salem nuclear power plant was temporarily shut down. Shipping was delayed. More than 180 birds died, according to reports.

Frescati paid $143 million to clean up the spill, and was seeking about $55 million, plus more for damage to the ship, said John J. Levy, a lawyer from Montgomery McCracken Walker & Rhoads who represented the ship owners.


The U.S. government reimbursed Frescati $88 million "and then they stepped into our shoes and sued for that $88 million," Levy said.

Slomsky's ruling was the third go-around in the courts.

Frescati filed an original contract claim against Citgo for breaching the "safe berth warranty," and a negligence claim against Citgo for failing to locate, warn of, or remove the anchor.

After a 41-day nonjury trial in 2010, U.S. District Judge John Fullam ruled that Citgo was not liable.

Frescati appealed and in May 2013, the Third Circuit appeals court affirmed in part, and vacated in part, Fullam's decision.

The Third Circuit sent the case back to the District Court. Slomsky got the case because Fullam had retired.

Slomsky after another trial reversed the 2010 decision, ruling in favor of the ship owner and the vessel operator, which claimed that when the Athos I struck the anchor on the river bed, Citgo Asphalt Refining Co. had failed its responsibility to provide a safe berth for the ship. The ship has since been scrapped, although part of it is in Baltimore.

Citgo had chartered the ship, the Athos I, to bring in the crude oil.

"The story of the final voyage of the Athos I and the reasons why it came to rest prematurely may be in the minds of the maritime community for years to come," Slomsky wrote. "But in this court, for now, its legal journey will conclude here."

The court found that the Athos I pilots, captain, and crew maintained proper safety management, which made the vessel seaworthy. The U.S. Coast Guard determined, not long after the spill, that the crew and pilots did nothing wrong in their approach and had not violated any regulations.



===============


Citgo plans to appeal $120 million ruling in 2004 oil spill

Published September 07, 2016
 

PHILADELPHIA – Industrial products company Citgo plans to appeal an order to pay $120 million for its role in a quarter-million-gallon oil spill in 2004 in the Delaware River, the company said in a court filing.

A federal judge in Philadelphia ordered the Houston-based company last month to pay $71.5 million to Frescati Shipping Co., the ship owner, and Tsakos Shipping & Trading, the ship operator, along with $48.6 million to cover about half of the federal cleanup costs, The Philadelphia Inquirer reported (http://bit.ly/2bYG6Wk ).

The judge ruled Citgo Petroleum Corp. failed to provide a safe berth to the Athos I oil tanker sailing from Venezuela. The ruling followed a lengthy court battle for the case, which has seen three trials and 70 days of court testimony.

"The story of the final voyage of the Athos I and the reasons why it came to rest prematurely may be in the minds of the maritime community for years to come," Judge Joel Slomsky wrote in a ruling. "But in this court, for now, its legal journey will conclude here."

The 264,000-gallon spill occurred when a tanker struck a submerged anchor as it approached the Citgo refinery dock in Paulsboro, New Jersey. It temporarily shut down a nuclear power plant, delayed shipping and killed more than 180 birds.

Citgo had chartered the Athos I to bring in crude oil.

The court ruled that the Athos I pilots, captain and crew maintained proper safety management, which made the vessel seaworthy. The U.S. Coast Guard determined not long after the spill that the crew and pilots did nothing wrong.

LEAVE TREE-CUTTING TO THE PROFESSIONALS: A Greenfield, Indiana businessman died from blunt-force trauma when the tree he was cutting fell on top of him


Man killed in tree-cutting accident

Search team found business owner dead in woods near Wilkinson residence

By Caitlin VanOverberghe -
September 7 2:02am



WILKINSON — A Greenfield businessman died from blunt-force trauma when the tree he was cutting fell on top of him Monday afternoon, officials said.

Robert “Ted” Smith, 70, of Wilkinson, was in a wooded area behind his home chopping wood when the tree he was working under split in half, falling onto him and killing him instantly, said Hancock County Deputy Coroner Rudy Nylund.

Smith, who owned Smith Implements, a tractor dealership located on East Main Street in Greenfield, enjoyed chopping wood as a way to exercise, family members said.

He headed out into the woods around 3:30 p.m. Monday, and his wife, Beth Smith, called 911 around 8:30 p.m. when he didn’t return, officials said.

As police headed to the man’s home in 7100 block of North Thomas Road in Wilkinson, search groups comprised of friends and family members began combing the woods looking for Smith.

A neighbor found his body just before 9 p.m., according to dispatch records.

Investigators are calling Smith’s death an unfortunate accident, and family members said they are shocked that the humble and helpful man died in such a way.

Giving back to the community that helped grow his farming equipment business was something Smith took great pride in, said his brother, Chris Smith.

Ted Smith founded Smith Implements, which sells farm machinery and lawn care equipment, with his family in 1979, and has given regularly since then to various community organizations, including the Hancock County 4-H program, FFA and the Hancock County Sheriff’s Department.

The profits from his business were often used to sponsor scholarships for high school students who planned to study in an agricultural field, Chris Smith said.

“It was just the way our parents raised us,” Chris Smith said. “(Ted) didn’t know a stranger.”

In his free time, Ted Smith was an avid golfer, who used the sport to form friendships with people across the region. Splitting wood was a hobby he kept to the weekends to help him stay fit, his brother said.

An autopsy will not be performed on Smith’s body; a routine toxicology test will be completed, though coroners said they do not believe Smith was intoxicated at the time of his death.

Family members said they are planning weekend funeral service, though details have not been released. Condo and Son Funeral Home in Wilkinson is handling the arrangements.

Anniston Army Depot production machinery mechanic killed in an accident in the Nichols Industrial Complex.





Anniston Army Depot officials identify worker killed Tuesday




By Zach Tyler, Star Staff Writer, ztyler@annistonstar.com


Anniston Army Depot officials on Wednesday released the name of the Goodwater man killed in an accident Tuesday in the Nichols Industrial Complex.


Willie L. Moon, 64, died that afternoon after receiving an “on-the-job injury,” according to information from the depot’s Public Affairs Office. Moon was a production machinery mechanic who’d worked 13 years at the depot, where Army leadership as well as civilian employees and the union that supports them are grieved by his loss, sources said Wednesday.


"The depot is a close knit family and the loss of one of our own affects us all," depot commander Col. Martine Kidd was quoted as saying in a release sent by the office. "We wish to express our deepest sympathy to Mr. Moon's family members. He will be sorely missed."


The release sent Wednesday morning did not specify how Moon received the injury that killed him. Depot spokeswoman Clester Burdell in an afternoon phone call said that’s because officials don’t know.


“That’s why we’ve got several teams here,” Burdell said. “We don’t want to speculate as to what happened.”


Burdell was referring to teams from the Army Safety Center’s Criminal Investigation Command and the Occupational Safety and Health Administration.


Investigators from both agencies were on scene at the depot today, she said, and seek to determine the cause of the incident.


“They’re going to do a very thorough, efficient investigation into what may have caused this. When that investigation is complete, the details will be provided,” said Burdell.


The chief of public affairs for the Criminal Investigation Command in an email Wednesday afternoon confirmed agents were conducting an investigation into Moon’s death.


“We do not suspect foul play at this point,” Christopher Grey wrote, adding that agents “have not completely ruled it out” while conducting the inquiry.




Kidd, meanwhile, was to address Moon’s death with the depot’s workforce Wednesday afternoon, Burdell said.


The vice president of the American Federation of Government Employees Local 1945 post said many of those employees are “totally disturbed” by the man’s passing.


“We lost the life of a union member,” Charles Barclay said by phone Wednesday afternoon. He described Moon as “a great employee ... an old-school type of worker” who planned to retire in the next few months.


Barclay said he’s now “trying to encourage employees to continue to work to support the warfighter, and to keep safety first,” as he said all employees are trained to do every day.


“This was just an accident that occurred,” he said, one “very outside the normal.”

SPEED KILLS, SLOW DOWN: Two teens killed in a crash west of Monte Rio when they crashed into a tree and burst into flames.



CHRISTI WARREN


THE PRESS DEMOCRAT | September 7, 2016, 8:35AM Updated 3 hours ago.

Two teens were killed in a crash just west of Monte Rio Tuesday night when their white Mitsubishi sedan careened off the roadway, crashed into a tree and the engine compartment burst into flames.

The driver, Edward Reynolds, 19, of Guerneville, and a female passenger were heading east on Moscow Road between Center Lane and Russian River Avenue about 10:30 p.m. when Reynolds lost control of the car. A California Highway Patrol release stated the car was traveling at a high rate of speed.

The woman’s identity has yet to be confirmed, but investigators believe she is 18-years-old.

A sheriff’s deputy was patrolling the area and saw the crash happen, a news release from the CHP said. The deputy used a fire extinguisher to douse the flames before backup could arrive.

When Monte Rio Fire Chief Steve Baxman arrived on scene, the car was lying on the driver’s side, its roof wrapped around the tree.

Both teens were wearing seatbelts, Baxman said, but were pronounced dead at the scene.

“The sad thing for us is it was our second double fatal in two weeks,” Baxman said, referring to the two young Jenner sisters who died in a crash Aug. 22 on the Russian River. “Two double fatals two weeks apart — that’s rare for us.”

The two are the seventh and eighth people to die in accidents in the county in two and a half weeks.



Dr. John Johnson of Holidaysburg, PA was charged for a second time for federal crimes involving money laundering.


Local doctor charged in insurance fraud scheme
By Katie O'Toole Monday, September 5th 2016


Dr. John Johnson of Holidaysburg was charged for a second time for federal crimes involving money laundering.


HOLLIDAYSBURG - Dr. John Johnson was charged by a U.S. Florida attorney for his second federal crime.

A release from U.S. District Court said Johnson and 15 other medical professionals across the country have been charged in a $175 million insurance fraud scheme.

The release also said Johnson received illegal compensation in exchange for issuing prescriptions for compounded medications, regardless of medical need.

Federal agents first raided Johnson's offices in 2014, including his doctor's office on East Walnut Street and his business Johnny on the Spot Car Wash.

A year-and-a-half long investigation later, a federal grand jury indicted him after they believed he kept employee payroll taxes instead of turning them in to the IRS.


Federal court documents show he pocketed about $700,000 of his employee's money.

It is unclear whether Johnson was still in practice after the taxes charge.

Documents said that his trial proceedings for that crime were not scheduled to begin until October.

ROSAURA RODRIGUEZ, 51, was arrested and charged with illegally collecting $22,000 in Workers’ Compensation benefits.


CT Nursing Assistant Charged with Workers' Compensation Fraud
By WorkersCompensation.com 09/06/2016 08:08:00
 

Rocky Hill, CT (WorkersCompensation.com) - A Waterbury woman was arrested today and charged with illegally collecting $22,000 in Workers’ Compensation benefits.

ROSAURA RODRIGUEZ, age 51, of 161 Prospect Street, Waterbury, was arrested by Inspectors from the Workers’ Compensation Fraud Control Unit in the Office of the Chief State’s Attorney on an arrest warrant charging her with one count of Fraudulent Claim or Receipt of Benefits.

According to the arrest warrant affidavit, Rodriguez collected more than $22,000 in Workers’ Compensation benefits as a result of a work-related injury she reported suffering in June 2015 while employed as a certified nursing assistant (CNA) at Saint Mary’s Hospital in Waterbury.

The benefits were intended to compensate Rodriguez for income she lost by being unable to work at the hospital and her second job as a live-in caretaker when, in fact, she continued to work the second job, the warrant alleges.

Rodriguez was released on a promise to appear in Waterbury Superior Court, G.A. No. 4, on September 13, 2016. The charges are merely accusations and she is presumed innocent until and unless proven guilty beyond a reasonable doubt.

The case will be prosecuted by the Workers’ Compensation Fraud Control Unit.

Joseph B. Fay Co. could face fines of $213,000 a day as a result of the welding fire that has closed the Liberty Bridge.








Contractor faces hefty fine for Liberty Bridge fire September 7, 2016 12:28 AM




Darrell Sapp/Post-Gazette


By Ed Blazina / Pittsburgh Post-Gazette

The contractor for the Liberty Bridge reconstruction could face fines of $213,000 a day as a result of the fire that has closed the bridge.

The state Department of Transportation's contract with Joseph B. Fay Co. calls for fines of $8,400 an hour — or about $201,000 per day — for the unexpected closure of the bridge and $12,000 a day for the closed ramp to the Boulevard of the Allies. The bridge has been closed since a fire began Friday afternoon when a welder's torch touched plastic pipe and spread to a construction tarp on the bridge for a painting project.

As a result, a 30-foot chord supporting the bridge buckled, closing the span for emergency repairs expected to last until at least next Monday. PennDOT has been working with the contractor and consultants including Carnegie Mellon and Lehigh universities to develop the repair. It will involve jacking up the bridge and installing a plate and two support beams in the damaged area.

PennDOT District Executive Dan Cessna said the final amount of the fine "will come down to the hour, or any portion thereof."

Fay has an $80 million contract to paint, replace the deck, upgrade the substructure, improve ramps and install new signs on the bridge.




Pittsburgh Public Schools Call 2-Hour Delay Tuesday Due To Closure September 5, 2016 3:59 PM By Ralph Iannotti


PITTSBURGH (KDKA) — Thousands of Pittsburghers will be going back to work Tuesday morning following the long Labor Day weekend, but they’ll be coming into city without the benefit of the Liberty Bridge.

The span has been closed since a fire last Friday.

Anticipating traffic delays, the Port Authority is putting a dozen additional buses in service, and also increasing “T” service. Also, Pittsburgh Public Schools will operate on a two-hour delay Tuesday because of expected traffic delays.

Shawn Wilk, who lives in the Bon Air neighborhood, said, “Traffic has been bad anyway recently because of bridge construction, but I think [Tuesday], with the bridge closed, it’s going to be a lot worse.”

Another South Hills driver, Joshua Horsley, told KDKA-TV’s Ralph Iannotti, “It’s definitely going to be difficult to get to work on Tuesday, but there’s not much you can do about it, you know what I mean?”

Dan Cessna, PennDOT’s District 11 Executive, said, “The day after Labor Day is typically a day when people are getting back to a normal routine; but Tuesday, I expect will be anything but normal for South Hills drivers.”

Welding sparks flew last Friday afternoon, igniting an intense fire that burned to 1,200 degrees and began melting the major support beam of the Liberty Bridge, which engineers say was only minutes away from collapse.

“Fortunately, the good service from the fire bureau, getting here very quickly, immediately getting the fire extinguished resulted in that catastrophe not happening,” Cessna said.

PennDOT is now working around the clock to repair it. That section of the beam is now bent and shrunken, and must be bracketed on both sides by new steel plates. The cost of all this will be born by the general contractor, JB Fay.

“With the benefit of hindsight, this operation would have been conducted in a different way to avoid that risk even existing. The reality is it happened. Our contractor is stepping up to the plate with full responsibility here,” Cessna said.  


The plates will be lifted into place by a crane and will reinforce the beam, supporting the weight of the bridge in that section and allowing the flow of traffic once again.

“The plan would be that by tomorrow the plates would be manufactured, assembly would start on Wednesday,” Cessna said.

And the work will continue through the week and the weekend in anticipation of a reopening next Monday morning. But until then, traffic promises to be nightmare.

Although, PennDOT plans to reopen the Liberty Tunnel to inbound traffic to at least allow some commuters to access the South Side by McArdle Roadway.

“The main commuters who would typically cross the bridge and into the city, they will be detoured,” Cessna said.

Pittsburgh Public Schools called for a two-hour delay on Tuesday due to the impact of the bridge closure. Officials say the delay will place a majority of students on the road after morning rush hour, “reducing potentially long wait times for the district’s smallest students.”

Some other schools are delaying their schedule as well, check the growing list on our School Delays & Closings page here.

The Port Authority is adding additional bus and rail service to commuters who use the bridge.

In a statement, the Port Authority says: “Port Authority has added limited amounts of bus and light rail service to its schedules this week to help accommodate additional riders. Riders should allow extra travel time during the week.”

Officials say they will operate two additional two-car rail trains and 12 additional buses throughout the week.

According to the Port Authority, PennDOT has offered to pay for the cost of the additional service.

Liberty Bridge Fire Burned To 1,200 Degrees, Welding Contractor Joseph B. Fay Co. Taking Responsibility, still facing massive fines






Liberty Bridge fire avoidable if standards followed 


September 9, 2016 12:00 AM



 



Michael Henninger/Post-Gazette
A crew works on the Liberty Bridge on Thursday, six days after the fire occurred.
By Ed Blazina / Pittsburgh Post-Gazette

The fire that risked bringing down the Liberty Bridge should not have occurred had workers been following long-standing fire safety measures, construction experts said Thursday.

Workers at all construction sites are supposed to follow standards set by the federal Occupational Safety and Health Administration and the National Fire Protection Association, including specific requirements when they are doing “hot work” such as welding or using torches to cut steel. The fire a week ago that caused a 30-foot chord to bow and put the 2,600-foot-long bridge in danger of collapsing started when sparks from a worker cutting steel ignited plastic ventilation pipe and a tarpaulin.

According to the NFPA, crews doing hot work should have any combustible material at least 35 feet away from the flame or cover it with fire-retardant material. In addition, at least one member of a hot-work crew should be assigned as a “fire watch” to check for potential problems and have fire suppression equipment such as a fire extinguisher immediately available.

OSHA has similar requirements for worker safety.

“This is completely avoidable. All you have to do is follow the rules,” said Frank Burg, a registered professional safety engineer and certified safety professional in Woodstock, Ill. Mr. Burg spent 18 years as an OSHA inspector and has operated a private firm, Accident Prevention Corp., for 22 years.

“I can’t imagine how this could happen if they did everything they were supposed to do.”

Joseph B. Fay Co., the general contractor for the $80 million bridge-reconstruction project, referred questions to an outside spokeswoman, who couldn’t be reached for comment. OSHA’s area office in Pittsburgh opened an investigation of the fire Wednesday and might need up to six months to complete it.

PennDOT district executive Dan Cessna said the agency is continuing to review the fire and won’t comment while other agencies are investigating. Fay filed the required safety plan as part of its contract and PennDOT hasn’t ordered any changes as a result of the fire.

“Obviously, you learn from issues and, obviously, this has been one,” Mr. Cessna said.

Another construction expert, David Gardner, said safety should be a daily priority at all construction sites, with regular meetings at least weekly to remind crews of safety procedures and note changes that occur as jobs progress. For example, cutting steel might not be part of a job until several months in, so safety procedures should be reviewed right before that work begins.

Mr. Gardner, who is based in Pittsburgh, is a civil engineering expert who specializes in construction safety for Robson Forensic in Lancaster. He said he has worked at job sites where Fay was one of the contractors and described the firm as “very safety-oriented.”

“Construction is inherently dangerous,” he said. “Sometimes you can do everything properly and [stuff] happens.

“But an accident the magnitude of this one doesn’t happen without repercussions.”

Since the fire, PennDOT has been working with the contractor, engineering consultants and experts from Carnegie Mellon and Lehigh universities to monitor the safety of the bridge and design a repair plan. Parts are being fabricated to attach a 26.5-foot steel brace on each side of the damaged chord, and jacks and possibly heat will be used to try to stretch it back to its original length, which was compressed by 1⅝ inches.

Parts should begin arriving today, Mr. Cessna said, but crews have been making progress by replacing temporary bolts on the damaged chord with longer, permanent bolts.

PennDOT hopes repairs are finished so the bridge can be reopened Monday.

Fay’s reconstruction work includes deck replacement, painting, structural steel work and new signs. About 55,000 drivers use the bridge daily.



==============

Pittsburgh Public Schools Call 2-Hour Delay Tuesday Due To Closure September 5, 2016 3:59 PM By Ralph Iannotti


PITTSBURGH (KDKA) — Thousands of Pittsburghers will be going back to work Tuesday morning following the long Labor Day weekend, but they’ll be coming into city without the benefit of the Liberty Bridge.

The span has been closed since a fire last Friday.

Anticipating traffic delays, the Port Authority is putting a dozen additional buses in service, and also increasing “T” service. Also, Pittsburgh Public Schools will operate on a two-hour delay Tuesday because of expected traffic delays.

Shawn Wilk, who lives in the Bon Air neighborhood, said, “Traffic has been bad anyway recently because of bridge construction, but I think [Tuesday], with the bridge closed, it’s going to be a lot worse.”

Another South Hills driver, Joshua Horsley, told KDKA-TV’s Ralph Iannotti, “It’s definitely going to be difficult to get to work on Tuesday, but there’s not much you can do about it, you know what I mean?”

Dan Cessna, PennDOT’s District 11 Executive, said, “The day after Labor Day is typically a day when people are getting back to a normal routine; but Tuesday, I expect will be anything but normal for South Hills drivers.”

Welding sparks flew last Friday afternoon, igniting an intense fire that burned to 1,200 degrees and began melting the major support beam of the Liberty Bridge, which engineers say was only minutes away from collapse.

“Fortunately, the good service from the fire bureau, getting here very quickly, immediately getting the fire extinguished resulted in that catastrophe not happening,” Cessna said.

PennDOT is now working around the clock to repair it. That section of the beam is now bent and shrunken, and must be bracketed on both sides by new steel plates. The cost of all this will be born by the general contractor, JB Fay.

“With the benefit of hindsight, this operation would have been conducted in a different way to avoid that risk even existing. The reality is it happened. Our contractor is stepping up to the plate with full responsibility here,” Cessna said.  


The plates will be lifted into place by a crane and will reinforce the beam, supporting the weight of the bridge in that section and allowing the flow of traffic once again.

“The plan would be that by tomorrow the plates would be manufactured, assembly would start on Wednesday,” Cessna said.

And the work will continue through the week and the weekend in anticipation of a reopening next Monday morning. But until then, traffic promises to be nightmare.

Although, PennDOT plans to reopen the Liberty Tunnel to inbound traffic to at least allow some commuters to access the South Side by McArdle Roadway.

“The main commuters who would typically cross the bridge and into the city, they will be detoured,” Cessna said.

Pittsburgh Public Schools called for a two-hour delay on Tuesday due to the impact of the bridge closure. Officials say the delay will place a majority of students on the road after morning rush hour, “reducing potentially long wait times for the district’s smallest students.”

Some other schools are delaying their schedule as well, check the growing list on our School Delays & Closings page here.

The Port Authority is adding additional bus and rail service to commuters who use the bridge.

In a statement, the Port Authority says: “Port Authority has added limited amounts of bus and light rail service to its schedules this week to help accommodate additional riders. Riders should allow extra travel time during the week.”

Officials say they will operate two additional two-car rail trains and 12 additional buses throughout the week.

According to the Port Authority, PennDOT has offered to pay for the cost of the additional service.

Franklin Thomas Wilson, who owned Transformer Collision Specialist gets jail for $85,000 insurance scam in Darby


Franklin Thomas Wilson


By Alex Rose, Delaware County Daily Times


Posted: 09/03/16, 8:10 PM EDT 

The former owner of a Darby Borough auto body shop was sentenced to 23 months of intermediate punishment Thursday after pleading guilty to insurance fraud and receiving stolen property.

Franklin Thomas Wilson, who owned Transformer Collision Specialist at 1006 Summit St., was among 11 people arrested in March 2015 for an alleged $85,000 insurance fraud scheme that included damaging vehicles with a fork lift to falsely inflate claims.

Wilson would meet with customers seeking body work on their vehicles and provide them with an estimate, according to a 30-page criminal complaint and affidavit of probable cause written by County Detective Lawrence Patterson.

After the customer departed, Wilson, 45, of the 100 block of Betsy Rawls Drive in Wilmington, Del., would take the vehicle to an empty garage at 850 Summit Street, across the street from the Darby Borough Police Department, and drive the vehicle into a pole or beam to cause further damage. He also used a forklift to damage the vehicles, according to the affidavit.
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The additional damage would take place before an insurance adjustor saw the vehicle. Once the insurance claim had been paid, Wilson would fix the customer’s vehicle for a much lower price and pocket the balance of the claim, the affidavit states.

Wilson also paid kickbacks to third parties that referred customers to his business with a portion of the insurance payout. One police informant claimed to have made approximately $10,000 by personally referring 30 to 40 customers to Wilson and said the scam had been running for years.

Wilson will serve the first five months of his sentence at the county prison in Concord, followed by six months of electronic home monitoring, under the plea agreement worked out by Deputy District Attorney George Dawson and defense counsel Laura Lazuski.

Judge Richard M. Cappelli also ordered Wilson to pay $68,476.18 in restitution, provide a DNA sample to state police and serve three years of consecutive probation. Wilson did not comment Thursday, but Lazuski noted he has already paid $15,000 toward restitution.

Two others charged in the scheme, Ashley Wilson, Franklin Wilson’s daughter, and her mother, Letisha Johnson, 44, of Philadelphia, entered into the Accelerated Rehabilitative Disposition program Thursday and received 12 months of probation.

Ashley Wilson, 27, of Darby, reported damage to Progressive on the right side of her 2010 Nissan Maxima in March 2014, according to the complaint. Analysis of the vehicle indicated it could not have been damaged in the way reported and Wilson was also seen delivering the undamaged vehicle to Transformers.

While the car was parked inside 850 Summit, the Nissan’s front and rear doors passenger doors suffered substantial damage, according to the affidavit. Detectives found Progressive had paid Ashley Wilson more than $5,000 in repair and rental fees.

Johnson, represented by defense attorney Kevin O’Neill, was accused of attempting to claim $12,000 worth of damage to her 2003 Nissan Turano from vandalism. She withdrew the claim following an interview from an adjustor.

Johnson was ordered to perform 40 hours of community service and pay $500 towards ARD Thursday, with the balance due within 90 days. Ashley Wilson was also ordered to pay $500 toward the program, perform 32 hours of community service and pay $5,340.55 in restitution. Dennis Coin, representing Ashley Wilson, said his client has already paid $3,000.

Three other defendants named in the complaint, Tywana Neal, 37, of King of Prussia, Adiaha Bell, 34, and Jamar Grant 29, of both of Philadelphia, have also entered ARD.

A bench warrant is pending for Vernon White, 34, of the 1500 block of 53rd Street in Philadelphia, who allegedly reported to Philadelphia police and Progressive Insurance that a truck struck the front of his Mercedes Benz CLS 500 on Oct. 8, 2011, while he was driving on Cobb’s Creek Parkway.

Expert analysis of the Mercedes showed the damage did not match the account given to police, according to the affidavit. Transformers was also under surveillance by this time and White was allegedly seen delivering the undamaged Mercedes to the business on Oct. 7. By the afternoon of Oct. 8, while never having left Transformers, the vehicle had gained substantial damage to its right side, the affidavit said. Progressive paid more than $13,000 on that claim, according to detectives.

White offered statements from three passengers in the vehicle at the time of the alleged accident: Nicole Walton, 42, Conchetta Edwards, 60, and Pamela Fields, 53, all of Philadelphia.

Walton is scheduled for a court appearance Tuesday. Fields is scheduled to appear Sept. 19 with White’s girlfriend, Shakeya Miles, 34, of Cherry Hill, N.J., who owned the car.

Edwards pleaded guilty in May to one count of theft by deception and was sentenced to two years of probation. She was also ordered to pay $15,257.70 restitution to Progressive Insurance.

21 people were injured when a Metrolink commuter train crashed into a semi truck in Los Angeles





21 Injured After Metrolink Train Crashes Into Tractor Trailer in Sun Valley: LAFD
Posted 11:15 AM, September 6, 2016, by Tracy Bloom, Chris Wolfe and Cindy Von Quednow, Updated at 03:28pm, September 6, 2016


At least 21 people were transported to local hospitals after a Metrolink train crashed into a tractor trailer that was trying to get off the tracks in Sun Valley on Tuesday, according to the Los Angeles Fire Department.


A patient was removed from a Metrolink train following a crash in Sun Valley on Sept. 6, 2016. (Credit: KTLA)

The crash occurred about 10:39 a.m. in the 8200 block of San Fernando Road, according to an LAFD alert. The train, which had six cars and a total of 187 passengers aboard, struck the truck from behind on the tracks.

The driver of the truck was not injured, officials said.

AV Line 212 was headed from Lancaster to Los Angeles at the time, according to Metrolink.

Sky5 aerial video showed the train was stopped on the tracks, with multiple emergency vehicles -- including LAFD trucks and ambulances, as well as Los Angeles Police Department patrol cars -- parked on the surrounding tracks.

Witnesses said the tractor trailer was in the middle of the tracks when the railroad crossing arms went down, the red lights started flashing and the bells were ringing.

The driver apparently tried to get off the tracks when the train hit the trailer.

“I just heard like a big boom when the trailer was trying to pass by quick,” said Jose Zamaniego, who was working at a nearby store at the time of the crash.

“I thought it was a big crash, but I didn’t see anything bad.”


Multiple patients -- most with apparently minor injuries -- were being treated after a Metrolink crash in Sun Valley on Sept. 6, 2016. (Credit: KTLA)

A triage area was set up near the train, and multiple people were being treated by emergency personnel, the aerial footage showed.

The injuries were considered to be minor and not life-threatening, according to LAFD.

By noon, the train was headed to its next destination. Officials warned passengers to expect delays of about 1 hour and 45 minutes for the line as a result of the incident.

A portion of San Fernando Road was temporarily shut down by the Department of Transportation as first responders worked to assess the number of patients.

The crash is under investigation and the driver has not been arrested.

September is Rail Safety Month, Metrolink spokeswoman Sherita Coffelt told the Los Angeles Times.

There have been at least 15 collisions at the Sunland and San Fernando crossing since Metrolink began operating in 1993, the Times reported.


Multiple emergency vehicles responded to a train crash in Sun Valley on Sept. 6, 2016. (Credit: KTLA)



==============
Los Angeles passenger train crash injures 21
SEPTEMBER 6, 2016

Nearly two dozen people were injured when a Metrolink commuter train carrying nearly 200 passengers crashed into a semi truck on Tuesday morning in Los Angeles, fire department officials said.

The collision occurred around 10:40 a.m. local time in Sun Valley neighborhood of Los Angeles, the Los Angeles Fire Department said. The department said 21 people were taken to area hospitals with minor injuries.

The driver of the truck was uninjured, the fire department said. Dozens of firefighters and medical personnel triaged the train's 187 passengers, fire department spokesman Erik Scott said.

Scott said the crash occurred in an intersection and a crossing guard arm appeared to have been snapped. Fire and Metrolink officials said the five-car, double-decker train suffered very minor damage and was able to continue on its route.

Law enforcement were conducting an investigation into the crash, Scott said.

Female student, 14, seriouly injured after she was struck by car in crosswalk near Riverside high school





A 14-year-old girl was hit by a car near a Riverside high school. (KABC)

By Leticia Juarez
Updated 32 mins ago
RIVERSIDE, Calif. (KABC) -- A 14-year-old girl was struck by a car while she was walking through a crosswalk in Riverside on Wednesday. Authorities said the driver fled the scene but was later detained.

The incident occurred near La Sierra and Cochran avenues around 7 a.m. The girl's backpack and shoes were strewn about at the scene, which is close to two schools, including La Sierra High School, where the girl was a student.

"She was in the middle of the street and there were two students trying to help her out of the way while oncoming cars were passing by," eyewitness Nicodemus Brito described.

Following the crash, the girl was taken by ambulance to Loma Linda University Medical Center in critical condition after suffering pelvic and internal injuries.

The girl's condition was later updated to stable.

Police said the driver stopped briefly then left the scene. She was later pulled over and detained.

"Our detectives and investigation officers are still trying to figure out if she was trying to beat a red light, or speed through the intersection or was just making a normal left turn," Ryan Railsback with the Riverside Police Department said.

Officials said they were also trying to determine if the girl was legally crossing the street.

Authorities said the driver was cooperating and that she was released pending further investigation.

Ruptured old 12-inch cast-iron water main results in 25-foot gusher and road damage in South LA






For nearly an hour Wednesday morning, water raged out of a broken 12-inch water main in South L.A. (KABC)

By Jovana Lara and ABC7.com staff
Updated 38 mins ago
SOUTH LOS ANGELES (KABC) -- A 12-inch water main ruptured below a street in South Los Angeles on Wednesday, officials said, resulting in a gusher that doused several nearby structures.

The cast-iron pipe broke at 8:37 a.m. on Western Avenue, south of Century Boulevard, a spokesperson for the Los Angeles Department of Water and Power said.

Aerial video from AIR7 HD showed a geyser rising about 25 feet into the air for nearly an hour before crews shut off the water.

"We couldn't do an initial shut down right away because there's multiple water mains out here," said DWP senior supervisor Eduardo Lopez.

Water gushed into several buildings, including Winnetka Vaden's beauty shop.

"The water just flooded everything here. The fire department came and put sand bags. I had to stand on the chair," Vaden said.

The incident prompted the closure of Western Avenue between Century Boulevard and 103rd Street and left the roadway visibly damaged. DWP says the broken pipe was installed in 1948.

Forty customers in the area, including apartment residents and nearby businesses, were without service for hours, DWP said. By 4 p.m., the pipe was repaired, and water service was restored.

Battery cell issue with the Samsung Galaxy Note 7 caused explosions and fires; forced the company to announce a global recall




Yet another Samsung Galaxy Note 7 has spontaneously exploded, this time reportedly racking up more than $1,800 AUD ($1,383 USD) worth of damages in a man’s hotel room.


The owner of the latest exploding Galaxy Note 7 is an Australian man who says he was on business trip when his hotel room almost went up in flames. He posted the entire saga on Reddit, under the alias Crushader. If true, the saga is downright scary for all parties involved.

“My brand new Note7 exploded this morning while I was still asleep, it was plugged in and charging,” he said. “Phone completely fried, I can’t eject the SIM tray to retrieved [sic] my SIM or the SD card. I was using original charger and cable if you are wondering. Charred the hotel room bed sheet and the carpet when I whacked it down to the floor, burnt one of my finger [sic] while doing that too.”


“[Samsung] told me this is the first case in Australia,” he added. “I have gone to Samsung store and they gave me a loan device J1, and have been promised that they will take care of the hotel damages bill.”


This is just the latest in a string of unfortunate events for Samsung’s Galaxy Note 7 release. Last week, Samsung announced a global recall following several reports that the phone was overheating and exploding.

“In response to recently reported cases of the new Galaxy Note 7, we conducted a thorough investigation and found a battery cell issue,” Samsung said in a statement. “To date (as of September 1) there have been 35 cases that have been reported globally and we are currently conducting a thorough inspection with our suppliers to identify possible affected batteries in the market.”

Samsung also vowed to take care of the people who’d already bought a Note 7 smartphone. The company promised to “voluntarily replace their current device with a new one over the coming weeks.” Apparently Redditor Crushader did not receive the memo. “It fizzed and then phone pop open, flame and smoke follow, almost had a panic attack sight to see waking up,” he said on Reddit.

The recall has been a major setback for Samsung. The company’s mobile profit was on track to post annual growth for the first time in three years, largely because of the success of the Galaxy S7 phone. The Note 7 was expected to keep sales going at a strong pace. With Apple expected to unveil the iPhone 7 next week, the timing couldn’t be worse for Samsung.

Tractor-trailer carrying hazardous material overturned, spilling battery acid on U.S. 29 in Greensboro






U.S. 29 lanes to remain closed until about 7 p.m. after battery acid spill


H. Scott Hoffmann/News & Record

Greensboro Fire Department Hazardous Materials team responded to a tractor-trailer carrying chemical containers that overturned, blocking U.S. 29 North in Greensboro, N.C. on Sept. 7, 2016.
 
Posted: Wednesday, September 7, 2016 9:39 am | Updated: 2:40 pm, Wed Sep 7, 2016.

By Danielle Battaglia danielle.battaglia@greensboro.com

Updated 2:26 p.m.
GREENSBORO — Lanes of U.S. 29 will remain closed until about 7 p.m. today, officials said.

Northbound lanes of the highway were closed about 9:35 a.m. after a tractor-trailer overturned at Wendover Avenue, according to a police news release.

Crews are cleaning up battery acid that spilled in the wreck, police said.

The N.C. Department of Transportation has set up a detour around the area.

Greensboro Assistant Fire Chief Dwayne Church said the vehicle appeared to be carrying the hazardous chemicals sodium hydroxide, hypochlorite solution and potassium hydroxide.

"At this point we're holding firefighters in place with hand lines," Church said. "We're in defensive mode and both hazmat teams are on scene."

Guilford County Emergency Medical Services took the driver of the tractor-trailer to Moses Cone Hospital.

Church said the driver was alive when he left the wreck site, but didn't know his current condition.

Firefighters deployed hazardous material monitors near the wreck site but hadn't been alerted to a leak, Church said.

Updated at 10:39 a.m.

GREENSBORO — Hazmat teams are responding to an overturned tractor trailer accident that will likely close northbound lanes of U.S. 29 until some time this evening.

Greensboro Fire Assistant Chief Dwayne Church said the vehicle appears to be carrying the hazardous chemicals sodium hydroxide, hypochlorite solution and potassium hydroxide.

"At this point we're holding firefighters in place with hand lines," Church said. "We're in defensive mode and both HAZMAT teams are on scene."

The single-vehicle wreck closed both northbound lanes of U.S. 29 at Wendover Avenue.

The driver of the tractor trailer was taken to Moses Cone Hospital by Guilford County Emergency Medical Services.

Church said the driver was alive when he left the wreck site, but they don't know his current condition.

Firefighters are using HAZMAT monitors near the wreck site but haven't been alerted to a leak, Church said.

Firefighters remain at a distance from the wreck until HAZMAT teams are ready to approach the vehicle.

Greensboro Police Lt. Chad Williams said the road will likely remain closed into the evening.
Police have set up detours taking motorists around the wreck to Gatewood Avenue.

Updated 9:56 a.m.
GREENSBORO — Police said all lanes of U.S. 29 north at the Wendover Avenue exit are closed following a tractor-trailer wreck. 


The truck overturned about 9:35 a.m. in a single-vehicle wreck, police said. It's unknown when the highway will re-open.

Posted 9:39 a.m.
GREENSBORO — An overturned tractor-trailer could cause delays on U.S. 29 northbound.

The wreck happened at the Wendover Avenue exit about 9:35 a.m., police said. Additional details are not immediately available.

Drivers that cut vehicles off that's behind them doesn't know the ripple effect that it's going to cause once they have left the seen , people are in such a big hurry to go nowhere and leave mass demonstrations behind them.

1 woman dead in Elmwood Park, NJ house fire after she was trapped by roof collapse








Michelle Charlesworth reports on the death of a woman in a fire in Elmwood Park

Eyewitness News
Wednesday, September 07, 2016 12:37PM
ELMWOOD PARK, New Jersey (WABC) -- One person died in a fire that burned through a multifamily Elmwood Park home late Tuesday.

The blaze broke out inside the house on Miller Avenue just after 11:30 p.m.

Responding officers discovered the house fully engulfed in flames, and thick heavy smoke emanating from the building. They attempted to force entry into the residence, but they were held back by the intense heat and smoke. The roof of the home caved in, forcing firefighters to battle the blaze from outside.

The fire was placed under control in about a half hour, and during the course of fighting the fire, the body of an individual was found in a second-floor bedroom adjacent to the kitchen. The victim, who was deceased and not been positively identified, was located on the floor next to the bed.

The building owner, a 90-year-old woman who lives on the first floor, was located at a neighbor's house. She reported being awoken by the sound of smoke alarms, and after observing heavy smoke in the common hallway, she immediately evacuated herself for her safety.

The woman who died was taken to the Bergen County Medical Examiner's office for further investigation and identification purposes. Though she has not been officially identified, she is believed to be a 36-year-old mother of two who lives in the apartment. Neighbors say her parents had picked up the children earlier in the day.

The cause of the fire remains under investigation, but officials say preliminary evidence points towards the origin being possibly in the kitchen and possibly due to an electrical appliance.

No emergency responders were injured during the incident

Car driver critically injured after he collided with the rear of a Houston ISD school bus.



A driver was critically injured after hitting the back of an HISD school bus. (New Waverly Volunteer Fire Department)

Updated 2 mins ago
WALKER COUNTY, TX (KTRK) -- A driver was critically injured Wednesday afternoon after hitting the rear of an Houston ISD school bus.

The driver was traveling southbound on I-45 near Park Road 40 when his car struck the bus, according to officials.

New Waverly firefighters were able to free the man from the pinned vehicle. He was treated at the scene and taken by LifeFlight to the hospital.

No students were on the bus and no other injuries were reported.

DPS is investigating the accident.

GONE FISHING OR DRUNK AS A FISH? Carnival Ecstasy Cruise Ship Passenger Reported Overboard Near Bahamas





EMILY SHAPIRO
Updated 13 mins ago


The Coast Guard is searching for a 32-year-old woman who reportedly fell overboard from a cruise ship near the Bahamas.

Around 2:30 a.m. Wednesday, crew members on board the Carnival Ecstasy said a woman "was reportedly seen falling overboard," according to the Coast Guard. A Carnival spokesperson said the ship guest "was witnessed jumping overboard."

The woman has been identified as 32-year-old Rina Patel. She is a resident of Interlaken, New York, authorities said. She was wearing a white dress with pink floral, according to the Coast Guard.

The ship was about 15 miles off the coast of Grand Bahama island when Patel was reported missing. Coast Guard air and boat crews have launched a search.

The ship was en route from Nassau, Bahamas, to Charleston, South Carolina. The ship is expected to arrive in Charleston, where it is based, on Thursday, according to the Coast Guard and Carnival. It departed from Charleston on Saturday for a five-day cruise.

Around 2:45 a.m. on Wednesday, a call came over the intercom that repeated "Man overboard" four times, passenger Shannon Parks told ABC News via email. When she went up to the 11th deck to see what was happening, spotlights were being shone onto the water, and the cruise ship had stopped, she said. A small rescue boat with a crew of five was lowered into the water, and the crew searched the area for a "long time," she recalled. A helicopter could be heard flying back and forth just before daybreak, and later a U.S. Coast Guard plane was doing the same, she said.

Parks described the crew as "organized" during the search and added that she was "impressed" with the way Carnival handled the situation.

A Carnival spokesperson said in a statement, "The company's CareTeam is providing assistance and support to the missing guest's family on board and our thoughts and prayers are with her and family and loved ones during this difficult time."

MESSY TEXAS: Harris County looking at 10 years of DWI cases errant testimony after crooked "expert's" Fessessework Guale qualifications questioned (she lied about type of diploma obtained)

The Ethiopian crook who falsely testified about her qualifications



Updated 3 mins ago
HOUSTON (KTRK) -- The Harris County District Attorney is asking defense attorneys to review a decade's worth of their DWI cases looking for possible errant testimony from a Harris County toxicology analyst.

According to a notice sent by the District Attorney's office last night, "Dr. Fessessework Guale of the Harris County Institute of Forensic Sciences may have testified in past trials that she received her Master's (sic) of Science degree in Toxicology when, in fact, she received her Master's (sic) of Science degree in Physiological Sciences (with coursework and research in toxicology)."

A review of Dr. Guale's resume however reveals that degree is from a veterinary college. She also holds a doctorate in veterinary medicine from an Ethiopian veterinary school as well.

The Harris County institute of forensic sciences says she is being retrained. They are confident in her expertise despite the resume issues.  Yah, sure.  Once a crook, she is always a crook.

3 died after a Beechcraft F33A Bonanza and a Diamond DA20-C1 plane crashed after suffering a mid-air collision in western Georgia

The Beechcraft F33A Bonanza that crashed after air-collision

 A typical Diamond DA20-C1 aircraft


 3 killed after two planes collide midair near west Georgia airport

Published September 07, 2016 

Emergency crews survey wreckage after two planes collide in midair near a west Georgia airport. (FOX 5 Atlanta)

At least three people were dead after two planes collided midair near a small airport in western Georgia on Wednesday, officials said.

Bud Benefield, a deputy fire chief for Carroll County, confirmed the crash happened near West Georgia Regional Airport, WSB-TV reported. The airport has a single runway and is uncontrolled, with pilots announcing takeoffs and landings to each other, according to a WSB-TV reporter.

The two planes involved in the crash were single-engine aircrafts, a Diamond DA20C1 and a Beech F33A.

Carroll County Fire Chief Scott Blue said a pilot who saw the crash from the air told authorities it appeared that both planes were attempting to land simultaneously "and one came on top of the other." However, Blue said investigators have not confirmed those details.

The fire chief said wreckage from the planes was so mixed together that first responders initially thought the debris all belonged to a single aircraft.

Blue says authorities have not yet identified those who died.

Carroll County is located about 45 miles west of Atlanta.



==============


Date:

07-SEP-2016
Time: 11:00 a.m.
Type:
Beechcraft F33A Bonanza
Owner/operator: Private
Registration: N6027K
C/n / msn: CE-833
Fatalities: Fatalities: 2 / Occupants: 2
Other fatalities: 1
Airplane damage: Written off (damaged beyond repair)
Location: near West Georgia Regional Airport, GA - United States of America
Phase: Unknown
Nature: Private
Departure airport:

Destination airport:

Narrative:
A Beechcraft F33A Bonanza and a Diamond DA20-C1 aircraft crashed after suffering a mid-air collision. A total of three persons died in the crash.


Sources:
http://www.foxnews.com/us/2016/09/07/3-killed-after-two-planes-collide-midair-near-west-georgia-airport.html
http://registry.faa.gov/aircraftinquiry/NNum_Results.aspx?NNumbertxt=6027K


Closer look at plane crash. Wow this is two planes mangled together. Unreal. @cbs46 pic.twitter.com/6YYzzAdybC— Vince sims (@SimsCBS46) September 7, 2016

200 gallons of gasoline spilled after the 38-foot vessel Charnade sank in the Chinook Landing Marina, in Tacoma, WA




Federal, state and local pollution responders observe the scene around the sunken 38-foot vessel Charnade in the Chinook Landing Marina. U.S. Coast Guard photo courtesy of Sector Puget Sound.


Coast Guard overseeing cleanup of sunken vessel in Chinook Landing Marina
Sep 7th, 2016 ·


 SEATTLE, WA— The Coast Guard opened the Oil Spill Liability Trust Fund in response to a sunken vessel within the Chinook Landing Marina in Tacoma, Tuesday afternoon.

The partially sunken vessel is a 38-foot wood-hulled recreational vessel and has a maximum potential gasoline spill of 200 gallons.

The vessel reportedly sunk while moored at 6:30 a.m., Tuesday and was reported to the Coast Guard at 9:30 a.m. by the harbormaster at the marina. The owner of the vessel hired Global Diving and Salvage to conduct the salvage, but was unable to meet the cost. After conversing with the owner, personnel from the Incident Management Division at Coast Guard Sector Puget Sound opened federal funding of the cleanup and retained the services of Global Diving and Salvage.

“We are working with our state and local partners to mitigate this pollution threat as soon as possible,”said Petty Officer 2nd Class Valerie Van Tine, federal on scene pollution responder, from Sector Puget Sound Incident Management Division. “The Oil Spill Liability Trust Fund is there to use for this very purpose – to clean up spills that can’t be funded otherwise.”

Personnel from Tacoma Fire Department and Washington Department of Ecology also responded to clean up around the sunken vessel.

RBT Welders LLC and Contractor Labor Services LLC owed back wages to welders and pipe fitters who worked on maritime vessels and oil and gas industry projects in Louisiana and Texas









Welders, pipe fitters along Gulf Coast to be paid $516K in back wages
Investigation finds staffing agencies misclassified workers to avoid overtime, other costs
 
NEW ORLEANS – Two Gulf Coast staffing agencies have agreed to paid 353 workers nearly $516,000 in back wages after U.S. Department of Labor Wage and Hour Division investigators found they classified employees incorrectly as independent contractors and mislabeled wages as per-diem reimbursement for expenses never incurred.

Federal investigators found RBT Welders LLC and Contractor Labor Services LLC owed back wages to welders and pipe fitters who worked on maritime vessels and oil and gas industry projects in Louisiana and Texas. RBT paid $398,379 to 246 workers and Contractor Labor Services agreed to pay $118,128 to 107 workers for overtime violations under the Fair Labor Standards Act.

The investigations were part of an ongoing, multi-year initiative to curb the pervasive practice by staffing agencies to attribute part of an employee’s wages wrongfully as per-diem payments, often to avoid or reduce overtime, payroll taxes and other costs. Division investigators are monitoring staffing agencies and other employers throughout the 1,600-mile Gulf Coast region for signs of this practice.

The division found that RBT Welders and Contractor Labor Services:
  • Attributed a portion of workers’ wages wrongfully as per-diem payments, rather than wages for hours worked, even though they did not incur lodging, meals and travel expenses as part of their employment. The practice based employees’ overtime hourly rate on an artificially lower rate, which excluded this mislabeled “per diem.”  
  • Attempted to reduce their share of federal and state taxes, workers’ compensation, unemployment insurance and Social Security by designating wages as per diem pay, not subject to these costs.
“Illegal per diem practices hurt law-abiding employers, defraud local, state and federal governments, and leave taxpayers in the Gulf Coast region and across the nation picking up the tab,” said Betty Campbell, regional administrator for the Wage and Hour Division in the Southwest. “Employers using this scheme gain an unfair advantage by lowering their labor costs while undercutting their own employees’ wages. They also compromise the benefits their workers would be entitled to receive in the event of a layoff, workplace injury or even at retirement.”

The Contractor Labor Services investigation also determined that the firm had misclassified employees as independent contractors. The practice resulted in overtime violations of the FLSA when the employer paid the misclassified employees an additional $2 per hour for overtime instead of the legally required time and one-half. Like the per-diem scheme, employers who misclassify attempt to shield themselves from business costs associated with overtime obligations, unemployment insurance, worker’s compensation premiums, unemployment insurance and Social Security payments required for employees.

Both staffing agencies signed agreements with the department to resolve concerns that surfaced in the investigations. The agreements require RBT Welders and Contractor Labor Services to:
  • Not advertise that workers will receive per-diem payments as a part of the their regular rate of pay or otherwise suggest in any way that workers may receive per-diem payments regardless of how close the worker lives to the  assigned work site.      
  • Issue genuine per-diem payments only to employees who incur expenses on behalf of the employer.
  • Identify those employees who qualify for real per-diem payments for lodging, meals, mileage or fuel expenses based on their incurring actual, reimbursable expenses on behalf the employer.
  • Ensure that employees do not receive per-diem payments that correspond directly with the number of hours worked.
  • Communicate, and ensure employees understand and acknowledge what constitutes a legitimately reimbursable expense that is excludable from the regular rate of pay.
The investigation also found that the staffing agencies and the client companies that used the services of the welders, pipe fitters and other craft workers employed them jointly. Had the staffing agencies failed to resolve the violations disclosed by these investigations, the department could have held the client or host companies responsible.

Employers must distinguish employees from actual independent contractors. An employee, as distinguished from a person who is engaged in a business of his own, is one who, as a matter of economic reality, follows the usual path of an employee and is dependent on the business that he serves. For more information, visit http://www.dol.gov/whd/regs/compliance/whdfs13.htm.

For more information about federal wage laws, or to file a complaint, call the Wage and Hour Division’s toll-free helpline at 866-4US-WAGE (487-9243) or its New Orleans District Office at 504-589-6171. Information also is available at http://www.dol.gov/whd/.
WHD News Release: 
09/07/2016