Entry into a Material Definitive Agreement, Financial Statements and Exhibits
Form 8-K filed with SEC July 22, 2014
Item 1.01. Entry Into a Material Definitive Agreement.
On July 17, 2014, Matson Navigation Company, Inc. ("Matson Navigation"), a wholly owned subsidiary of Matson, Inc. (the "Company"), entered into a Settlement Agreement (the "Settlement Agreement") with the United States of America, acting through the United States Department of Justice and on behalf of the United States Surface Deployment and Distribution Command ("SDDC"), and Mario Rizzo ("Rizzo") for the settlement of litigation relating to the Company and its affiliates in the case entitled United States of America, ex rel. Mario Rizzo v. Horizon Lines, LLC et al. (the "Litigation Matter"). The terms of the settlement were disclosed in the Company's Annual Report on Form 10-K for the year ended December 31, 2013.
Under the terms of the Settlement Agreement, Matson Navigation has agreed to pay to the United States $9.0 million in full settlement of all claims in the Litigation Matter. Matson Navigation has also agreed to pay $950,000 to Rizzo for expenses and attorney's fees and costs. The parties to the Settlement Agreement have filed a joint stipulation of dismissal of the Litigation Matter with respect to the Company and its affiliates and released each other from certain claims related to the Litigation Matter. The Settlement Agreement is not an admission of liability by the Company or any of its affiliates.
The foregoing description is qualified in its entirety by the terms and conditions set forth in the Settlement Agreement, a copy of which is filed as Exhibit 10.1 to this Current Report on Form 8-K and is incorporated herein by reference.
Item 9.01 Financial Statements And Exhibits.
(d) Exhibits Exhibit No. Exhibit 10.1 Settlement Agreement dated July 17, 2014 by and among the United States of America, acting through the United States Department of Justice and on behalf of the United States Surface Deployment and Distribution Command, Matson Navigation Company, Inc. (together with Matson, Inc., and all affiliated entities) and Mario Rizzo. 2
* * * * *
HR: Hawaii's dominant shipping carrier to pay $9 million to settle federal whistleblower case
Star-Adv: The shipper allegedly charged fuel costs for military household goods shipments
Background--November 20, 2013: Did Matson and Horizon Lines defraud the United States?
In a nutshell, the Relator alleges the defendant ocean carriers improperly and with intent applied ocean bunker fuel surcharges to inland (overland) freight charges. Inland freight is either fully exempt from fuel surcharges or fuel surcharges are strictly proscribed by the terms of carriage for military household goods. These terms are issued by the federal contracting agency, the U.S. Surface Deployment and Distribution Command (SDDC) of the U.S. Department of Defense (DOD).