Pounds v. King Transportation Services

Case Background

Terry Pounds sued King Transportation Services for fraud after discovering the truck he financed for $85,000 was collateral for a loan. He claimed he would not have entered the agreement had he known about the undisclosed collateral. The case was filed in the Madison County Court in Mississippi. Judge Staci O’Neal presided over this case. [Case number: 22-770]

Cause

On September 8, 2020, Terry Pounds signed a lease agreement with King Transportation Services for a 2007 Peterbilt truck tractor and flatbed trailer. Under the terms, Pounds agreed to pay $653 weekly through payroll deductions for 130 weeks, totaling $85,000 by the end of the lease.

Unbeknownst to Pounds, King Transportation had simultaneously used the truck as collateral for another loan. The collateralized value matched the total lease amount of $85,000. Meanwhile, Pounds consistently made payments, used the truck, and maintained it by handling necessary repairs.

In 2022, Pounds discovered King Transportation’s undisclosed collateral arrangement. He believed this omission amounted to fraud. Feeling deceived, he stopped making payments and initiated a lawsuit against King Transportation.

Damages

Pounds sought damages for fraud, claiming reimbursement for all expenses he incurred on the truck through 2022. These costs included lease payments and maintenance, which totaled $127,552. Additionally, if the jury determined that King Transportation committed fraud, they could award punitive damages in a second trial phase.

Key Arguments and Proceedings

Legal Representation

  • Plaintiff(s): Terry Pounds
    • Counsel for Plaintiff(s): Omar L. Nelson
  • Defendant(s): King Transportation Services
    • Counsel for Defendant(s): James W. Janoush

Claims

Pounds filed the lawsuit alleging fraud, breach of contract, and a violation of the implied warranty of good faith. His claims centered on King Transportation’s failure to disclose that the truck was used as collateral.

Pounds explained that he intended to purchase the truck at the end of the lease. However, knowing the truck was collateralized created a risk of repossession if King Transportation defaulted on its loan. Pounds argued that, had he known about this risk, he would never have entered the lease agreement.

Defense

King Transportation disputed the facts of the case. Its principal testified that he had informed Pounds about the truck’s lien. The defense argued that Pounds fell behind on his payments and filed the lawsuit as a response.

Additionally, King Transportation denied that Pounds had suffered any damages. They contended that he used the truck without interruption and received the full benefit of the agreement.

Jury Verdict

The case was tried in County Court in Rankin. The jury eventually reached a verdict on August 27, 2024. Although the specific details were not recorded, it is believed that Pounds won on all claims, including fraud. The jury awarded him $225,000 in compensatory damages. In the second phase, they added $225,000 in punitive damages, bringing the total to $450,000.

However, Judge O’Neal reduced the final judgment to $200,000 to comply with the court’s jurisdictional limits.

Court Documents:

Documents are available for purchase upon request at jurimatic@exlitem.com