The dispute between billionaire CEO of Pilot Flying J, Jimmy Haslam, and the Chairman and CEO of Berkshire Hathaway, Warren Buffett, took a surprise turn over the weekend as a billion-dollar trial scheduled to begin on Monday in Delaware Chancery Court was abruptly canceled.
The trial was set to determine whether Berkshire Hathaway had used an accounting method that would short-change the Haslam family in a purchase of the family’s remaining minority stake in Pilot Travel Centers. The cancellation came just two days after a brief conference between the judge and lawyers for Berkshire Hathaway and the Haslams to discuss the logistics of the trial.
It is not immediately clear why the trial was canceled and whether a settlement has been reached between the two parties. The cancellation leaves lingering questions regarding the claims made by Berkshire that Jimmy Haslam, who also owns the Cleveland Browns football team, had offered “illicit side payments to numerous PTC senior executives” to boost the value of the family’s remaining stake that Berkshire would be compelled to purchase.
Furthermore, the cancelation of the trial raises questions about the reported federal probe into the allegations against Jimmy Haslam by prosecutors in New York.
Greg Abel, the designated successor of Warren Buffett, was expected to testify at the trial, the outcome of which could have led to Berkshire paying up to $1.2 billion more for the Haslams’ stake in the company than otherwise would be paid. Berkshire currently owns 80% of PTC after purchasing the majority stake owned by the Haslams in separate deals in 2017 and 2023.
The Haslams had a “put option” to compel Berkshire to buy out their remaining 20% stake in the company every year. Last year, the family sued Berkshire, alleging that the conglomerate had used pushdown accounting that would have the effect of lowering the stated value of PTC, shorting the Haslams on what would be legally owed to them.
While the reasons behind the trial’s cancelation remain unknown, one thing is certain – the dispute between the Haslam family and Berkshire Hathaway continues to captivate the business world. CNBC has reached out to spokespeople for both companies for comment on the cancelation of the trial.