Up To Speed: Highway guardrail fraud suit ordered to mediation (Video)

Oct 29, 2014, 6:42am PDT

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Oct. 28 (Bloomberg) -- Christine Short, senior vice president at Estimize, discusses Facebook's third-quarter earnings with Bloomberg's Matt Miller on "Street Smart." (Source: Bloomberg)

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Matt Jiggins | cc-licensed https://flic.kr/p/77hK5t

A member of a construction crew helps control traffic in this file photo. (Photo by Matt Jiggins. Used under Creative Commons license.)

David A. Arnott: Assistant News Editor; Email | Google+ | Twitter | LinkedIn

This month, Trinity Industries lost a judgment that the company had defrauded the United States government of about $175 million when it failed to inform the government of design changes it made to highway guardrails it had sold. As Korri Kezar of the Dallas Business Journal explained at the time of the verdict, US District Judge Rodney Gilstrap was charged with determining how much Trinity (NYSE: TRN) might actually pay, as a whistleblower suit was filed under the False Claims Act, and lawyers estimated the final judgment could reach $1 billion.

Now, Judge Gilstrap has ordered Trinity and the whistleblower, Joshua Harman, into mediation to resolve the dispute by the end of the year, according to a report by the New York Times. Should the two sides fail to reach agreement, the report said, the case could stretch on in court. The Times added that Trinity's third-quarter earnings, released Tuesday, indicated it took in $1.6 billion revenue and had a quarterly net income of $150 million.

Multiple states have said they will stop buying Trinity's ET-Plus guardrails since the suit broke, and at least one, Virginia, said it would physically remove the guardrails from its roadways. -- New York Times

Today's video: Why investors are disappointed with Facebook
Even though Facebook (NASDAQ: FB) reported profit and revenue that either met or exceeded most expectations, the company's stock stayed essentially flat. That may have been because investors wanted still better news, and it may have been, in part, because Facebook's stock has climbed pretty high from the start of the year already. -- Bloomberg video above

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David A. Arnott is assistant news editor with The Business Journals.

Industries:

Logistics & Transportation

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