Armchair Attorney Breaks Down Convoy and TQL Freight Drama

Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Blythe Brumleve (00:05):
Welcome into another episode of Everything Is
Logistics, a podcast for thethinkers in freight.
We are proudly presented by SPILogistics and I am your host,
Blythe Brumleve, and we got ahell of a show for you today
because we are going to cover alot of ground.
Guest today Matthew Leffler,from Armchair Attorney, also
famous content creator in thefreight space.

(00:26):
We're going to get into a lotof legal issues going on within
the industry and then we'regoing to get into a little bit
of the power of content creationand maybe some Lord of the
Rings talk a little bit later onin the show.
No Rings of Power.
This is a safe space from thatabomination of a show which I'm
still recovering from the PTSDfrom it.
But yeah, we'll get into itlater.

(00:47):
We'll get into it later.
Let's set the scene for today'sshow, because there's so much
drama going on in freight whenyou have TQL getting sued, you
have Convoy shutting downabruptly, you have Slink.
io I don't know what the hell isgoing on with that situation.
So this is why I wanted to haveyou on, so you could help us

(01:10):
break down these complexindustry things that are going
on and then how we can sort ofsee the pathway out.
So first, I guess, welcome tothe show.

Matthew Leffler (01:20):
Thank you for having me, Blythe.
It is always a pleasure to beable to talk with you, break
down topics, find underunderstanding, find that place
of compromise where we can bothagree that we need more people
to be fans of Lord of the Rings,even if all of the material
that comes out isn't perfect.
We don't want the perfect to bethe enemy of the good, and even
if it's not good, it could bebetter, and we want people to be

(01:42):
encouraged that they shouldwatch everything Lord of the
Rings.
It's very important.

Well, hopefully my little increasing your
volume there just didn't mess upas far as like computer
notifications.
So if you heard that, I'm sorry.
I apologize that he was in themiddle of a speech, but maybe I
can remember that for later onin the show.
If you start complimentingRings of Power, I can just
adjust the volume.
Just mute me, is that?

the idea?
That's.
That's.
I'm glad you have the power.
This is what I always worriedabout when you had all the power
Would it corrupt you andapparently like the one right,
absolutely that siren,absolutely.
No one can put it down, no onecan give it up voluntarily.
I understand, I understand.
Thank you for having me.

I'm so excited to be here.
Yes, thank you for coming onthe show, especially with such
short notice.
Like I said, there's just somany industry news topics that
are draw.
It feels like one after another.
You can't really catch a break.
It's almost similar to verymuch to like world news of all
the you know worldwide dramathat's going on.
And then we have freight.
That has its own little justnot little, but a lot of

(02:41):
industry drama.
So what I was kind of hopingfor is that we have a few
different situations, especiallyaround the freight brokerage
space.
So kind of wanted to talk about.
You know, what's going on withthree PLs right now?
What's going on with freighttech?
How do we move forward?
So let's let's first start withthe TQL situation.
Now, tql is one of thosebrokerages that is made fun of a

(03:03):
lot, especially in the memespace, but they are one of the
top dogs, if not the topbrokerage, in the entire
industry.
So what's going on with themand how should industry
professionals, I guess, learnfrom this drama?

Yeah, so I have my, my TQL pen here.
I got this from a dear friendof mine, charlie Safro.
I love TQL.
Let's let's set the stage.
So a lot of stuff we're goingto talk about is really market
driven right About, like how themarket and the freight
recession has been going on andit'll continue for a period of
time.
Tql is this story, for TQL hasnothing to do with the market.
This has to do with incrediblybad leadership that is going to

(03:39):
result in a massive amount ofliability.
So let's set the stage.
Tql is the second largestfreight broker in the United
States.
They do about $8 billion a yearin revenue, that's billion with
a B.
This is a big business and theyhave been brokering freight for
over 20 years.
Leader of this company, kenOaks.
So we're going to talk aboutKen quite a bit.

(03:59):
This case is really interesting.
So here's the story.
Tql has this program and theprogram is for junior freight
brokers.
They call them in the lawsuitLAETs, the Logistics Account
Executive Trainees, and once youpass this trainee period, you
get to be something another name.
They call it a LogisticsAccount Executive, but they call

(04:21):
them a Junior Logistics AccountExecutive.
This is what it's all about.
Are you exempt or are you notexempt from overtime?
This is the fundamentalquestion that has been answered
and asked over and over again inevery single industry.
Tql took the position that ifyou are a Logistics Account
Executive Trainee or a JuniorLogistics Account Executive, you

(04:41):
don't get overtime.
And what we find is those folks, those men and women who go
into the business of brokeringfreight, have about at the
minimum, 26 weeks of being aLogistics Account Executive
Trainee something like that halfa year and they're working 60
hours a week.
60 hours a week.
They're doing phone calls,tracking trays, cold calling all

(05:02):
of the things that juniorfreight brokers do.
So in 2010, tql gets sued andthey get sued under this thing
called the Fair Labor StandardsAct, essentially the statute
that says who's exempt and who'snot exempt.
Lawyers were exempt.
I don't get overtime.
I can sit in a windowlessoffice for 16 hours a day and
it's always the same amount ofmoney.
I don't get more for workingmore, but in other spaces you do

(05:25):
get overtime, and this was thefundamental fight.
Blythe is whether or not theseyoung, though, these junior
executives or junior brokers,deserve or are required to be
paid overtime.
When this litigation started in2010, it went to trial in 2022.
The verdict came out inSeptember 26, 2023.

(05:48):
This is 13 years of litigation.

Why did it take so long?

This is what we call bet the farm litigation,
which is to say, this is themost challenging and difficult
litigation you're ever going toexperience as a business.
If you lose, you can lose yourbusiness.
So you fight tooth and nailabout who the plaintiffs are,
how you look at a class actionsuit, and so in this case, it's
4,500 brokers, all in the stateof Ohio from 2008 to 2016.

(06:18):
That is the class of peoplethat are suing and it went to
trial and TQL lost.

Okay, okay, all right.
Fourth out of TQL.
First of all, I have a bunch ofquestions.

First of all, I love this, I love it.

Okay, so TQL had 4,000 brokers that were
affected by this in just thestate of Ohio.

Yeah.
So the way to look at this isTQL admits in their own
depositions and in the discovery95% of people who go into their
program leave.
They burn out, they go.
So this is a meat grinder, thisis an old school.
Bring them in, break them overthe wheel, throw them away and
the cream will rise to the topand you move on.

(06:59):
That is why you see me all thetime talk about non-competition
agreements, because that 95%that fail out all have a
non-compete.
They can't go back in thisbusiness.

So that's one of those little kind of caveats
to remember about this, so thatmakes a lot more sense now,
while there's so many folks inOhio that are making this or are
making this judgment orparticipating in this judgment.
Now my next question is howdoes TQL get to determine who is

(07:30):
exempt and non-exempt?

from overtime?
Yes, that's a great question.
So that is the fundamentalinquiry for this lawsuit is who
told you to make them exempt ornon-exempt?
What was the reasoning behindthis?
And it's revealed in thedeposition of Ken Oakes that he
got that advice from theTransportation Intermediaries
Association.

(07:52):
He went to TIA and said, hey, Ihave these people, what should
I do with them?
And they said well, the otherparticipants in the space call
them exempt, we call them exempt, they don't get overtime.
So those 60 hours a week,weekends, nights, holidays,
whatever they're not going toget overtime.
That decision was again made byTIA, or recommended by TIA, and

(08:17):
Ken Oakes followed it.
He didn't go to the outsidecounsel, didn't go to the
internal counsel, just said I'lltake that advice, that's so
strange.

Now go ahead.
I'm sorry.

Well, this is the part that makes it so
interesting.
So these people that wereworking this job average salary
was about, let's say, $36,000 ayear.
So if you're working that,you're probably making like $17
an hour or something in thatrange.
If you're making overtime, yourrate is time and a half, like
$24 an hour.
The liability in front of TQLright now, right now, for this

(08:48):
one case in Ohio, on the mostconservative estimate, is $100
million.
On the high end it's like $200million.
Now why it's important to knowthese numbers and we'll talk a
lot about it because it'samazing, but these are numbers
that are uninsurable throughyour general liability policy.

(09:08):
This is paid out of youroperating capital.
You have to take money fromyour bank and hand it to the
lawyers and say here is yourmoney and TQL lost.
They tried to make the argumentthat these freight brokers were
administrative personnel, kindof like your HR department or
your marketing department oryour whatever payroll department

(09:30):
, which can be considered exemptin certain manager positions.
But for these brokers they weredoing clerical work.
They were all clerks They'vecalled everyone to call them but
they were just doing clericalstuff.
And because they weremisclassified and we look at
these average amounts of 20hours of overtime per person per
week.
And you take the 4,500 people,you can start doing those math

(09:52):
and you can start getting thosenumbers.
So that is why the litigationis so interesting, because this
is how our industry operates.
It is a systematic issue of howyou classify a trainee.
Once they start gettingcommissioned, you're done, you
don't have to worry about itanymore.
But if they're just gettingstraight salary draw, with no
other commission or variablecomponent, they're likely going

(10:14):
to be considered exempt.
I mean sorry, they'reconsidered non-exempt, which
means they must get overtimeexempt being they don't get
overtime.
It's fascinating.

I still have a bunch of questions about this
one.
Is it only exclusive to Ohio ordoes this have a chance to
spread out to all states?

This is a contagion.
So it's only Ohio.
This one here is only Ohio.
People keep asking, matt, canTQL handle a $200 million
verdict?
Of course they can.
That's probably one quarter oftheir operating capital, their
earnings, so they're going tolose an entire quarter of
profitability.
If you have four or five caseslike this, your knees start to

(10:52):
buckle.
You get 10 cases like this,you're out of business.
I don't care how big you are,how smart you are, and so this
has the absolute potential tospread any place where TQL is
doing this program and for anyother freight broker who
followed the guidance that wasoffered by TIA is also on the
hook.
Now two really cool thingsabout this case.

(11:14):
Oh good.

Where did those balloons come from?

So Apple has a thing If you do this, it'll make
balloons.
I don't know how this works.

Sorry if you're just listening.
He just had a bunch of balloonsgo up in front of his face and
I didn't know if that was asoftware thing on my end.

No, it's on my side and I should know that?

Did you do that on purpose, based on the topic
you were talking about?

No, I moved my hands, I talked with my hands.
I'm kidding, I'm kidding, I'mkidding.
The first thing that's reallyinteresting is this thing called
liquidated damages.
Liquidated damages is onlyawarded in these cases if it's
shown that you didn't act ingood faith.
So there's a question that'sgiven to Ken Oaks and TQL.
When you were asked, are thesepeople exempt or not exempt?

(11:59):
How hard did you work to getthe answer?
Did you go to outside counsel?
Did you go to local counsel?
Did you go internal with yourown company?
How hard did you work?
And under deposition, under thepenalty of perjury?
Ken Oaks says no, I just wentto the TIA, I just asked them.

That's all I did.
Well, how normal is it to askan association about hiring
practices?
You would think that if you'vebeen in a brokerage business for
at least 10 years, you haveestablished hiring practices.
So why, in that moment, did hefeel as if he had to go to an
outside association to ask aquestion that he probably

(12:36):
already knew the answer to?

Yeah.
So that's a really goodquestion.
I don't think we know theanswer.
I think there's a combinationof.
He knew TIA would likely givehim the answer that he wanted to
hear, because if you were to gointo the wayback machine,
you're going to add probably$10,000 to $20,000 in payroll
expenses per person to do it thecorrect way, and that's really

(12:59):
if your operating margins aren'tsuper great.
You're not going to want tomake that change.
Number two a lot of these tradeassociations and I love them, I
really do they make you thinkthat they're indispensable.
They make you think that theyknow everything about the law
and compliance, and they don't.
They're not fiduciaries,they're not out here saying I'll

(13:20):
put myself in your shoes andgive you the best advice.
This is what everyone's doing.
Okay, that seems like what Iwant to do.
So liquid data damages wasessentially taking the total
amount that TQL had to pay inbackwages and doubling it.
So that's how we get to thenumber from 45 million in
backwages to potentially $90million with the liquid data

(13:40):
damages and if it's higher andI've heard inside people saying
they think it's going to becloser to $200 million that's
why it's so imperative.
You have to do the job thatyou're hired to do.
Now the part that I really findinteresting if you're a
corporate officer of one ofthese businesses and you're
found to have violated the FairLabor Standards Act, you are

(14:02):
individually, personally,jointly and severally liable for
the entire amount.
So if TQL can't pay that $200million and I can for this one
it's on the hook for Ken.
And if you're a freight brokerout there and I can't emphasize
enough how important this caseis if you're a freight broker
out there and you follow thispattern and practice of how you

(14:23):
classify your trainees, you areon the hook.
You can be sued individuallyfor everything that you have.
I can pierce the corporate veil, I can get to your car, I can
get to your bank account, I canget to your home, I can put a
lien on your property and forcea foreclosure.
I will get paid.

(14:43):
And so people have tounderstand when you make these
shortcuts in making hiringdecisions and classification
distinctions, it's at your ownrisk, because if you don't know
the law, it doesn't matter.
We don't need you to know it,we just need you to know that
we're coming for you.

You know what this kind of feels like when
you're driving down the highwayand you see all those billboards
that are like have you been ina truck accident?
Call us and we'll get you themoney you deserve.
Is that kind of maybe what thefuture holds for freight
brokerages?

Absolutely.
I cannot emphasize enough theamount of people who have
reached out to me, whether it'sthrough Reddit or Twitter or
LinkedIn, and said hey, do youknow anything about Florida or
Illinois or California, whatever?
And these cases are going tocome.
They are going to come.
And the other part that'simportant to note is, again,
there's no insurance you can buyfor this.
Number two, you're personallyliable for it.

(15:33):
And, number three, it alsorewards attorney's fees.
So if you win, if you're theplaintiff and you sue and you
win, you, the employer, have topay the lawyer's bills for your
side and their side.
So the liability is substantial.
And, tia, they made a statementwhen this case came out, when
Ken Oaks was deposed, and theysaid they didn't agree with the
ruling, which is to say, likethey're not denying what they

(15:55):
said, Like they're not saying wedidn't tell him that, they're
saying we disagree with theinterpretation.
So I'm telling you, freyBrokers, like if you think TIA
knows what they're talking aboutas it relates to this issue, I
would be very skeptical.
I would take a beat and makesure that you actually are doing
it correctly.
Now, this is the part of life Iget really excited about because
it makes it really keck.

(16:16):
So let's say you are doing itwrong and you want to do it
right.
You're going to go to your FreyBrokers and say, hey, guys and
gals, we're going to make youguys, we're going to make you
pay you hourly.
And they're going to say, well,that's weird, why is that
happening?
And they're going to Google itand they're going to see the
case against TQL and they'll seepeople like us talking about it
, because this case happened toRobinson, this case happened to

(16:38):
Echo and they lost those cases.
But those cases got buriedbecause no one talked about it.
This is why what we do is soimportant because young people
don't know their rights.
I have a bunch of pieces ofpaper on my wall that talk to me
about how I know people'srights.
So this is why this case is sointeresting.

It's really fun .
Why do you say that?
Because, just thinking of themodel of Frey Brokers, I started
working in one more than 10years ago.
It actually went out ofbusiness 10 years ago, so closer
to like 15 years ago is when Iworked in one, and it was just a
constant effort for us to go tothe college, down the road,
find some people that are justfresh out of graduation and

(17:18):
recruit them to come work forthe Frey Brokers and you just
make them hammer the phones.
It sounds like that.
That is just a normal thingthat happens across Frey
Brokerages.
Is it safe to say that hiringpractice will still continue?
But they need to just classifythem correctly.

Yeah, I think that'll absolutely, because
it'll happen.
So we need in this business,meat for the grinder and the
meat can be off-shored laborwhich has a lot less rights to
deal with and a lot easier andcheaper to do with.
There's a lot of brokers havemoved in that direction, but
they still need young people inthe United States to come and do
these cold calls and do all thetracking, tracing, all this and
they're going to do the samepractice they always have.

(17:59):
If they make the challenge,they decide to classify them as
exempt.
They're not going to besuccessful long term.
They will come, and that theywill come soon.
And the liability isastonishing.
It's astonishing and it's amassive amount.
So we'll see what happens.
The next phase in the TQLlitigation is the damages phase,
so liability has beenestablished.

(18:21):
It is absolutely the case inOhio.
In this case, you have to payovertime.
The next probably month or two,we'll start getting the data
about how much that's going tobe and then it'll be settled or
it'll be gone.
The verdict will be issued andthen it'll be appealed.
Like there's no doubt in mymind, tql will appeal this thing
, no matter what.

That was going to be.
My next question is how long isthis actually going to take?

Yeah, I mean.
So a good example to thinkabout this is there's a Werner
Enterprises case down in Texas,a horrifying tragic accident.
$98 million verdict.
Werner's appealing it.
There's a lot of facts that areinteresting in that case.
But it's already over $10million, maybe closer to $15
million, in interest.
So if you decide you're goingto appeal, you have every right

(19:04):
to do so.
But that interest doesn't stop.
It just keeps ticking up.

I had no idea there was interest on settlement
awards.

Oh yeah.

It makes sense, Otherwise you know.

There's pre-trial, there's pre-trial
interest and there's post-trialinterest, and it's absolutely
collectible.
So what the people in the TQLlitigation are going to be
entitled to is all of the backwages, the liquidated damages
which is doubling the initialamount attorney's fees,
pre-judgment, post-judgeantinterest and any costs and the
costs like TQL is going to haveto make a website probably, and

(19:38):
send out letters and emails toevery former in person in Ohio
and say, hey, you're probablypart of this class, You're
probably entitled to some money.
Here's how you file your claimto get your capital and it's
going to be wild.
It's going to be veryinteresting over the next couple
of months.

Do we know if TQL changed their hiring
practices like this when thesuit first started, or did they
continue as business as usual?

I don't know the answer, so it's conflicting.
I've had former TQL people saythat it's still done as a salary
.
Some have moved, said it'sactually become hourly.
It varies state to state butthis is a federal statute so it
all.
Honestly, they will all have tobe hourly as trainees.
There's no doubt in my mind,and other big brokers that have
been following the same pathway,will have to adopt a new

(20:22):
strategy, because you cannot dothis.
It's not sustainable.

I just find it so just fascinating that they
would not conduct inside councilor talk with them.
I mean the brokerage I workedfor, you know.
I think at our peak we madeclose to 300 million.
It's a drop in the bucketcompared to $8 billion and you
didn't have in-house I wouldimagine you should have an

(20:46):
entire legal team of dozens ofpeople and set an $8 billion
operation.

So one of the things that's important to note
in this litigation was thisquestion of willfulness
willfulness of TQL violating thelaw, and what willfulness means
in the context of this case isthe statute of limitations, like
how far they look back goesfrom two years to three years.
So if you knew the law and youmade the wrong decision, your
exposure is increased.

(21:13):
So there's always there's anincentive, I think, for some
people to have plausibledeniability.
So in this case, tql was notfound to have willfully violated
the law.
Even though they were, theydidn't act in good faith to
validate the right answer.
So here's the question If yougo to outside council and they
go to me say, matt, what shouldwe do?
And I say, ah, you shouldclassify them as non-exempt,

(21:35):
because they're non-exempt.
And they say that's going tohurt our business model.
And I say I don't care aboutyour business model, I'm talking
about the law is.
And they'd say, well, we'll doour own thing anyway.
So there's a there's a level ofbeing able to put your head in
the sand and not actually befound to know the answer when
there's no doubt, like they allknew what they were supposed to

(21:55):
do.
They just chose not to do it,and I understand that mentality
to an extent.

Are you in freight sales with a book of
business looking for a new home?
Or perhaps you're a freightagent in need of a better
partnership?
These are the kinds ofconversations we're exploring in
our podcast interview seriescalled the freight agent
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Now I can tell you all day thatSPI is one of the most
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(22:22):
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But I would much rather youhear it directly from SPI's
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And what better way to do thatthan by listening to the
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(22:43):
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Do we know how?
Originally, because if you say,like you know, 95% of the
brokers that came through thismeat grinder end up just washing
out how did they start to firstlike formulate that this is
wrong, we shouldn't be doingthis.

(23:03):
You know we all need to gettogether and, you know, do
something about this.

It takes one person.
It takes one brave person who'slike I think that this is wrong
and I'm going to make a claimby myself with a lawyer and then
that lawyer can then exploreare there ways to get more
people involved?
But at the end of the day, mostpeople don't want to be seen as
litigious, like they don't wantto sue their former companies.
They don't want to get thatmark on their resume that says I

(23:29):
sue former employers.
So for their own preservation,they're not interested in doing
that necessarily.
The other part of it is it's aculture Like if you're, if
everyone tells you and your HRpeople tell you this is the
legal way we do it, you don'tknow any better.
I mean, they're not hiring abunch of lawyers like me to be
brokers at TQL.
If they did again, that'd be abad decision.
I wouldn't recommend it.
But that's the issue.

(23:51):
Like we don't actually know.
You know how many people findout or how they learn about this
, but what they're going to dois they're going to see, they're
listening to podcasts like this, they're going to look at
articles in freight waves andother publications and they'll
understand they do have rightsand then that hopefully gets
them moving to make the phonecall to the attorney and
understand.
Do I have a claim?

(24:11):
What's the process for filingone?

Do you have any kind of guesses on how
prevalent something like this ishappening across all freight
brokerages?
Is it 30%, 40%?

We're going to find out.
I guarantee you, the next roundof these litigations are not
going to be just opposing thesenior leaders of the folks at
the company, they're going tooppose the folks at TIA and
they're going to say tell me howmany more people you told this
to, because there's going to befreight brokerages out there.
I guarantee you 10, 15 people,shops that have four or five
employees that are consideredexempt, working $32,000 a year

(24:47):
at 60 hours a week.
There's no doubt in my mind andin this environment which we'll
talk about convoy, we'll talkabout slink you don't have a lot
of margin anymore.
You don't have the war chest tofight that litigation, and so
if you're already on the cusp ofinsolvency, this will destroy
you.
Litigation like this costs acompany $20,000 to $50,000 a

(25:10):
month, and that's before it's intrial.
That's just doing discovery.
So this stuff, oh life, it's soexciting, it's so much fun.
The lawyers out there, they'rechomping at the bit, they're
like, oh wait, the billboardsare going up, they're going up.
They're going up.
Every loves every TA pilot flyand J call me, I'll get you
money, I'll get you paid.

Do you think this is still prevalent in the
industry right now?

Oh yeah, absolutely 100%.
I have no doubt.
I mean, just from the inquiriesthat I've been fielding, it is
absolutely prevalent, it stillexists.
As to how pervasive it is, Idon't know, but it's clear that
it's not a rare phenomenon frommy encounters with folks in the
business.

How do you think this reshapes brokerage as
a whole?

I would be very skeptical.
If a broker can survive in thatkind of environment, what I
will say is it will exacerbateand accelerate offshoring and
automation.
A lot of the work that theseentry-level people do can
absolutely be automated.
There's no doubt in my mind.

The tracking and tracing.
It will just increase it.

Yeah, You'll find ways to reduce your cost
and reduce your liability.
Offshoreing saves your life.
It saves you in this.
There's no overtime when youoffshore.
Maybe there is locally, but notto the extent we experience the
United States.
I think it just continues thistrend that accelerates to
automation and offshoring.
The people who survive and wantto do it all domestically,
they'll have to make somechanges.

That means less operating margin probably
Probably more investment intechnology, which brings us to
our next freight drama piece,convoy.
Unexpectedly or maybeexpectively, depending on how
closely you follow the newsdeclared that they were going
under.
I don't know if that's theright phrasing to use, but they
ceased operations in theircurrent form just a week ago.

(26:59):
Depending on when you'relistening to this, we're
recording this in late October.
Just a week ago, they ceasedoperations in their current form
and now are exploringtechnology buyouts.
They first entered the scene.
I believe you probably knowmore about this than I do.

Yeah, I'm not sure.
I think it was early 2015.

I was going to say 2013.

Yeah, they're not super old.
They're founded by non-druckingpeople.
Go figures and that exciting.
The reality is that Convoy cameout thinking that they were
going to create an applicationthat truck drivers would use to
accept loads.
What Convoy?
Their thesis was if shippersuse our platform to find drivers

(27:43):
, we can automate the finding ofthe driver.
In that development, they endedup adding trailers into their
fleet.
They had about 4,000 trailers.
Ultimately, their belief wasthey could automate and remove
brokerages.
That was wrong.

That was a dumb idea.
The digital freight brokeragemovement, I think, is what they
coined.

Yeah, exactly, they really did think that that
category would remove thegeneral freight brokers.
The story of Convoy isfascinating.
These guys and gals raisedalmost a billion dollars from a
whole bunch of verysophisticated people.
They played a game of how theyvalued the company.
For your listeners who have alittle mind for finance, the way
we talk about value intransportation is a thing called

(28:25):
EBITDA Earnings Before Interest, taxation, depreciation,
amortization Silly Buzzword, butit really just says how
profitable are you After youtake out all this other stuff?
How much money do you stillhave?
These digital companies, thesesoftware companies?
They don't have that.
They take a dollar and thenthey spend a dollar or they
spend two dollars.
They don't ever actually havegeneral profitability.

(28:48):
When they go to market and theysay how valuable are you, they
look at their revenue and theytimes it by 10.
If I'm a $300 million dollarfreight broker, like you
mentioned before, and I'm atechnology company, I'm actually
worth $3 billion, which is whatConvoy's highest level of
valuation actually was.
It's absurd, it's pretend, it'spretend money, it's a pretend

(29:12):
way of communicating what you do.
They're all trying to say we'regoing to be the Facebook of
freight or we're going to be theAmazon of this or that and
we're going to be the Uber ofthis.
They get this crazy amount ofpretend stuff but then
ultimately the money runs out.
When the money runs out, youdon't have a business anymore.
That's the story of Convoy.
Convoy was doing great.

(29:32):
I mean, they had all the greatmarketing, they had their logo
on all sorts of places, but forthem they weren't actually
making money.
They weren't profitable.
They still had a need forinvestor capital to help them
continue operations In thisenvironment.
There is no more money.
No one's coming out there andsaying I'll give you $500
million to keep your brokeragealive.

(29:54):
For Convoy, when the money ranout, the business model imploded
.
As of this recording on October25th, they're not in bankruptcy
yet, but they are certainly onthe cusp or likely preparing
those same files.
This is a freight brokerage thathad some software.
Now the story we see now issomeone might try to buy just

(30:15):
the software, not buy anythingelse, just the tech.
We'll find out what the valueis, but I heard stories of this
company going to big enterprisebrokers and saying would you buy
me?
They look for how much?
Oh, we want a billion dollars.
We want our investors to bemade whole.
People who gave us money wantto pay them back.
They're laughed out of the room.
They're laughed out of the room.

(30:35):
I heard a number.
Someone had offered Convoy $50million.
This is wild speculation.
Don't take anything you hearfrom this as being accurate.
But this is the rumor that Iheard.
What a far cry that is.
You take a billion dollars inprivate money and you only have
$50 million to show for that.
That is absurd.

Who is giving these valuations?
How are they on two differentsides of the spectrum here?
Is it basically just you'reworth what somebody's willing to
pay?

That's to an extent.
I think the story you tell isif I can take the market share,
I can turn it into money.
I can make it really profitable.
Give me money and I will buy myway into being a real player.
Then eventually I'll have somuch market share I can make
some adjustments on the sidesand now we're making a ton of
money.
This is how technology hasalways been done.

(31:28):
You look like Theranos, right?
Elizabeth Holmes, yes, ofcourse.
She's a great person.
She went out there and sheconvinced people.
She made a testing machine thatcan do all this magical stuff,
and she never did.
But the investors they have afear of missing out.
They don't want to miss thenext Facebook.
They don't want to miss thenext Amazon, these companies
that they have the right pitchman, they can make you think

(31:49):
that they're going to be thatthing.
Who gives money to Convoy?
Well, bezos did, amazon did.
Oh my gosh, how could they failif Amazon's throwing this money
at them?
This was the behind the scenesthinking is the smart money will
throw at us and we'lleventually get to a place where
we're dominant.
The challenge they ran into,like everybody, is moving
freight.
It's not easy Just because youhave an app that a driver may be

(32:11):
able to give you track andtrace information doesn't mean
they're going to do it correctlyand you still have to call if
the driver doesn't show up, likethere's still all these other
problems.
So this is why a convoyultimately was unsuccessful, and
I think they were too soon.
I don't think that theirhypothesis is wrong.
I just think that ultimatelythey're not ready in this
business.

They didn't have enough freight people who
understood it, and so this mightsound like a really stupid
question.
Did they have any traditionalbrokers that worked in the
convoy office?

Oh yeah, they became a brokerage.
I mean they would take theinvestor money and spend
millions and millions of dollarsgetting more technologists and
getting more software developers, but they absolutely had
brokers, like they probablyneeded a lot more brokers, just
like when Uber Freight bought, Ithink, transplace.
They had to buy the rightmentality and I think that they

(33:01):
mistook how valuable actualbrokers are and the brokers that
are real, like the real brokers, didn't have a seat at the
table, as far as I could tell,with convoy.
It was all technology peopleand they didn't understand what,
when the market shifts becauseit always shifts how you prepare
yourself for it.

Do you think that at its core?
Because, from a lot of justreading just after this news
dropped, reading between thelines, I've never used convoy
software.
I wouldn't have a need tohighly respect what they were
trying to make waves.
Ultimately, you shoot for themoon.
Sometimes you miss, especiallyif you have.
The biggest criticism I'veheard is that they've done so

(33:44):
much money, but I've still heardthat the technology is quite
good.

Yeah, I mean, I think that's someone will find
value in good technology thatcan connect you to drivers, like
there's something reallyimportant and useful there.
But the reality was like you goto the trucker subreddit, to
the freight broker subreddit andyou see the money that's being
posted.
It's not great, it's not aterrific software.
It doesn't really do anythingrevolutionary necessarily.
I think if you were to put afast forward, like 10, 15 years,

(34:11):
yeah, you'll have autonomoustrucks that can take digital
requests from a technologyconvoy to go move a load for
proctoring, gambling.
That makes sense.
That'll happen.
But as of right now, mostdrivers multi-home.
You cannot, as a truck driver,you cannot live off that app
alone and be profitable.
You are still going to DAT,you're still going to truck stop
, you're still doing whateveryou can find.

(34:31):
So it was never a solution foreverybody.
It was a nice to have.
When convoy presented that toshippers, they didn't present it
that way.
Or to investors, they didn'tpresent it that way.
They'd say we have 80,000 truckdrivers, or 100,000 truck
drivers.
Like, how many of them are usedto your software every day?
How often do they open the appup?
Oh, once every two weeks.
Okay, then you don't have100,000 truck drivers.

(34:51):
You have a fraction of that.
So it's all about how they putthis together, and I think the
investors are not assophisticated as they think they
are, and I think that thetechnology companies don't do a
very good job of understandingthe space they actually want to
occupy.

So what do you think is next for these digital
freight brokerages?

I mean, there are a few of them that are still
, oh, bankruptcies, they what Imean.
I think that the real takeawayfor me, I think the real take
sorry, I'm getting some lag onmy side so I apologize I think
the takeaway is gonna be we'regonna see a lot more
bankruptcies.
Many of these companies werenot designed to operate in this

(35:30):
environment economically and theaccess to cash is not gonna be
there.
The access to debt is not gonnabe there.
Interest rates are high.
So the takeaway is gonna besome of them will survive, many
of them will fail, and that isprobably the best possible
outcome, because we need to havethe market reduce capacity for
everything, and that may beuseful.
The bigger takeaway is, I think, this like then, the central

(35:52):
thesis is correct Like, you willnot need brokers to do
everything.
There will be so many otherpathways to automate that
process.
I just think convoy came in toosoon and they didn't have the
right leadership to figure out away to actually transition to a
real business.

Are there any brokerages out there that we can
kind of like point people tothat are doing things just from
an outsider's perspective, doingthings the right way, balancing
relationships, sales andtechnology, that are kind of
combining those three things theright way?

Yeah, I would say companies like Freight Vana
seem from the outside to knowwhat they're doing.
I think Loadsmith is also kindof learning that same idea you
need to have access to for thesedigital freight brokerages.
I think you have to have accessto trailers.
Like you're not gonna make agreat business model without
having some trailer capacity youcan promise to a shipper.
But I think there are some thatthere have not been.

(36:46):
If their operations aredependent upon investor capital,
they're all gonna fail.
If their businesses areactually profitable or break
even without taking out a bunchof capital or debt, then they're
in pretty good shape.
So I think there are some thatare out there, but those
companies don't marketthemselves as technology
companies.
They're very clear we usetechnology.
You can't run a businesswithout technology.

(37:06):
But you're not a technologycompany.
You're a freight broker thathas access to technology.

Which I think, when everything is all said and
done.
I saw someone say this Iapologize for not crediting you,
but the best thing that Convoydid was to force other
brokerages to adopt newertechnology.

Yeah, I think absolutely.
That's a great line.
I mean, I think that's exactlyright.
We are in a below averageindustry.
It's a massive industry, but itis not as good as it could be,
and there's a lot of things thatare wrong.
One of the things that I thinkis wrong is technologies that
aren't connected and not beinginnovated.
Now you look at someone like JBHunt, 360 or Werner with their
technologies for Drop and Hookand Power.

(37:44):
Only they're all gonna catch up.
They're all there already and Ithink we'll see just more of
that over time.

Do you think when you say more of that over
time, do you see a world wherewe just have like a I don't know
, five to 10 really bigtech-focused brokerages or cause
?
To me, like a freight brokeragehas always been that thing
where you could start and youcould, as a blue collar job like
you could well kind of bluecollar that you could start and

(38:12):
see a pretty good amount ofsuccess, you know, even just
being a broker, being a freightagent, things like that.
Do you see a world where thoseroles still exist in that way or
is?
it a world where like five or 10companies are gonna dominate at
all.

I think it'll always be highly fragmented and
the value of a broker is notgonna go away Cause they're
gonna know things that are justnot on the technologies out
there.
That being said, it's notefficient.
I mean, in my mind that's notefficient at all.
I think you look back at theidea of, like before
deregulation, when it was, allyou know, a handful of trucking
companies did everything.
That was a simpler and likely,you know, easier to install

(38:51):
model, but it's more expensive.
So I think you're gonna havethis, the same kind of challenge
you see today, just at adifferent level.
So it's still gonna befragmented, it's still gonna
have freight brokers, it's stillgonna have technology.
I do think that it would benice if we could get a singular
system that everyone canunderstand and use.
But everyone is coming out andsaying, well, we can do that,
just let it be our platformfirst.
It's like, well, we're not allgonna jump to you, you know I'll

(39:12):
jump to me.
So it's still gonna befragmented at some extent.

Which I think is good for overall competition.

So oh, absolutely, I think with
autonomous trucks I mean, if wesee the FMCSA come out really
hard with a level four and levelfive automation, like truly no
driver in the truck, then theneed for and the desire and the
ability to do a platform thatdoesn't involve brokers becomes
a lot easier, Cause those robotsdon't take meal period breaks.
They don't take that.

I don't know that autonomous trucks are gonna
happen.
I'm one of the.
I think the truckers have gotto me.
I was, you know, definitely,like you know, when you see
these trucks up close and don'tpeople, don't truckers don't
kill me for saying this but theylook incredible.
The technology is so crazy.
It's the the light arc and Ilove, you know, our

(39:57):
archeological fan, I love thatsort of stuff.
So, like LiDAR cameras, thefact that these things are on
the side of a truck, and ifyou've seen them like, I've seen
them at Manifest, the future oflogistics conference.
It's coming up in January.
You know, check my link in caseyou want to buy your ticket,
save $200.
Okay, quick plug.
But a lot of those trucks.
They're so impressive that youcan walk up and the LiDAR

(40:19):
cameras are by far my favorite,just because you can.
You can see it in action wherethere was one of these trucks
that they had a TV on the hoodof the truck and then you could.
People would be walking by onthe trade show floor and you
could see the LiDAR camerapicking up every arm, elbow,
finger, foot on every personthat was walking by, very, truly

(40:41):
impressive.
But I just, you know, is seeinga lot of what's going on with
crews out in San Francisco, alot of those issues you know,
with the bottlenecks, with thecars actually running someone
over and, I think, dragging themfor like 20 feet or something
like a lot of those things.
And that's just residential.
I think residential isincredibly tougher for, you know

(41:03):
, autonomous vehicles.
I just don't know that.
I see, I think, one badaccident from an autonomous
truck, especially on a long haul, and that's gonna be it.
The government's gonna shut itall down.

I don't disagree with you.
Here's what I would say.
First, I'm gonna introduce youto a friend of mine, michael
Beezinger, from Kodiak.
I want you to talk with him, soyou can get him.

I have interviewed the founder Dan.

Okay, there you go, he's great.
Yeah.
So they are moving freighttoday with autonomous trucks,
like they are moving things intrust state Within a given state
.
There is a safety driver who issitting in the truck watching
it go.
The thing you have to keep inmind is the way I look at this
stuff.
If it's possible, it becomesinevitable.
So deregulation was the biggestinnovation our supply chain had

(41:49):
in 50 some odd years.
Independent contractor even moreso the ability to control
somebody but not have to paythem all these and slay benefits
.
So there's no doubt in my mindthat these trucks will
ultimately be more pervasive,they will become more affordable
and I think there'll be a placewhere certain routes will be
preferred to have robots do it,cause it'll be consistency,

(42:11):
it'll be cost savings.
The two biggest costs intransportation are labor and
fuel and they kind of rotatewhich one's the biggest?
Usually it's fuel, but if youcan reduce labor cost, that is a
way you bring down cost ofgoods and you look at things
like Outriders, an autonomousspotting truck manufacturer this
is on non-DOT regulated soilwhen they're moving these trucks

(42:31):
around inside of a warehouse ora rail yard.
So I see it as an inevitability.
Now is it five years, 10 years,15?
I couldn't tell you that, butthere's no doubt in my mind that
if you look at the ATRI surveyslike what motor care is care
the most about?
Their biggest concerns areabout driver compensation,
driver retention, drivershortage and all of those buzz

(42:52):
words.

I was gonna say , that's gonna get people
triggered too.
We need robot.
You say driver shortage.

Yeah, I see, I'm with you.
I think we have a shortage ofdrivers who wanna do terrible
jobs but don't pay very well,like that's the issue.
So we can't find enough driversto work for 20 bucks an hour
going over the road.
They don't wanna do that.
So, yeah, I'm with you.
I just I do think that we'llsee robots sooner than later.
And for the robots listening,I'm on your side.
I will betray the humans in aheartbeat, like I love.
The humans are great, but I'mon your side.

Yeah, listen.
If you can do all of mymarketing and cut a good clip
for YouTube shorts, I'm on yourside too.
There you go see what I'm like,so I do think I think fully
autonomous.
I couldn't even guess if thatwould ever happen in my lifetime
, but I do see a future withhaving autonomous trucks plus a
driver.
I still think you need someonethere to take over.
If there's congestion on theroad, you have to have somebody

(43:41):
make that quick adjustmentinside the truck and override
the technology Cause sometimes Ijust think that we're over
reliant on technology when thehuman mind is still there.
That can make a good driver isinvaluable.
An experienced driver isinvaluable.
The problem is is that it issimilar to the meat grinder of

(44:03):
the freight brokerage industry.
You have the meat grinder ofthe recruiting process of these
CDL mills and getting driversthat are being trained by
drivers that are.
You know, I've only been sixmonths on the job before they
become a trainer.
It's that that is a level ofdanger, like even though I'm pro
driver, but that is such alevel of danger that you know
there's folks out there that aredoing a good job of spreading

(44:25):
awareness about that.
So I think that we need to havelike a happy medium with the
experienced drivers andtechnology.
It has to somehow come together, because having inexperienced
drivers in charge of you knowsomething that's you know,
50,000 pounds, if not more, isjust a recipe for disaster, I
think.

Oh, you're exactly right.
I mean, I think, just to buildoff that we saw Governor Newsom
in California veto a bill thatwas going to mandate a safety
driver in autonomous vehiclesfor trucking.
And so even OIDA, who's theowner operators, their interest
group they had tried to makesure that Newsom did not veto
this, which was again lettingsomeone not have a driver inside

(45:04):
the truck.
If the safety case can beproven out, I think it becomes
impossible to stop At this stage.
It's a really good collisionavoidance system, like we have
cameras facing the driver,facing outside, all these things
, the sensors are everywhere.
It is a matter of time beforethese things become more
pervasive and for my purposes Idon't see how it doesn't happen

(45:26):
in a way that is profoundlychanging to our industry.

I mean, it could also have a massive effect
on, you know, just autonomoustechnology in general.
You know, I was reading a storythe other day that was talking
about or I was watching the AllIn podcast and David Freeberg,
who is my favorite person onthat show.
He was talking about how muchof just from a theoretical
perspective, that we as a nationhave become so risk averse that

(45:50):
we have there's one cruise caraccident and we halt the whole
damn thing and we stop progressbecause of one incident, whereas
if you compare it to humandrivers, you know it's still the
.
you know, drunk driving,impaired driving, distracted
driving not wearing a seatbeltor all leading causes of death

(46:12):
just across the country.
And so if we can have some ofthese technology solutions that
can still give power to thedriver, I think there's a happy
medium, maybe that we can meetin the middle, where you know
you still have the driver that'sempowered to make a decision
when it calls for it.
But you know, for a lot of the,you know the everyday decision
making, you know just takingmaybe that decision making out

(46:32):
of the hands of the dummies whoare drinking and driving and who
are impaired, driving and youknow, causing accidents and
ruining families.

Absolutely.
I'm with you there, absolutely.

All right and more positive news.
The next one on this list isSling.
I'll be honest with you withSling.
This one came out of nowherefor me and I'm trying to
understand where it fits in theoverall sort of I guess news
landscape outside of the ownerjust stealing money, essentially

(47:05):
.

Yeah, I think we can kind of bridge it for
both the convoy discussion andthe TQL discussion.
So TQL, fundamentally myopinion is a failure of
leadership.
It's leadership that was notproactive and being compliant
and that's why they got hit.
And then convoy was.
You know, capital marketsshrank, they couldn't raise any
more money and they had to winddown.
Sling is a combination ofmalfeasance of the owner, so

(47:27):
Kirchner I think it's ChrisKirchner's name, I don't know, I
never met him Found one of theCEO of this company, sling.
I to this day do not know whatSling did.
It sounded like they didsomething with data and machine
learning and algorithms.

So they did integration, software
integrations.

Oh, perfect, yeah, that's what we need.
We need more of that.
So they had raised about $70million or so over the course of
however long they were doing itand their CEO Kirchner he had,
I think it was their Series B,maybe even Series A had that
money directly funneled to hisbank account.
And then he bought a jet andthe Securities Exchange

(48:03):
Commission said we don't likethat, that's not what investors
money is as one does yeahexactly.
So he got in trouble.
He's under indictment, he's gotall the legal stuff going on.
But the reality was Sling is atechnology company that had been
valued at almost $300 millionor some bizarre number they had

(48:24):
gotten to, which was a functionof their revenue times a
multiplier, and we see thisfiling.
It's a very strange filing.
It's called an assignment forthe benefit of creditors and
I'll break it down because it'sreally interesting.
But Clarissa Haas has a greatarticle that came out with
Freight Ways talking about thisthing.
I might have been mentioned init with some background

(48:44):
information.

I did read that article.
Great, I love Clarissa likepart of her bank.

Oh, she's great , she's fantastic.
But the story is like if you'regoing to go bankrupt, you have
to file bankruptcy.
A trustee is appointed toadminister the state, like the
bankruptcy estate, and then thattrustee takes whatever assets
you have and hands them out likepays off your legal defense,
pays off the trustee court, paysoff your secured creditors,

(49:10):
pays off your unsecured andwhatever's remaining if there's
anything remaining that goes tothe former shareholders.
They get their money,whatever's left, on a
proportional basis and they'redone.
What Sling opted to do is notdo bankruptcy.
So bankruptcy has two mainthings.
The first thing is called thestay.
The bankruptcy stay says all ofyour suits stop, now they're

(49:31):
done.
And the example I'll give youis in yellow's bankruptcy, the
biggest trucking bankruptcy inUS history.
They had gotten sued for aviolation of a war and act.
It essentially is like ifyou're going to do a mass layoff
, you got to tell your people,you got to tell them hey, we're
going to lay you off in twomonths.
Well, that lawsuit, thatlitigation was stopped and it
got brought into the bankruptcycourt Because the bankruptcy

(49:53):
court's saying I don't carewhat's happening anywhere else
in the country.
This is the only thing thatwe're talking about is the
bankruptcy.
Everything else is stopped, sothe stay is incredibly powerful.
The other thing at the end ofbankruptcy is the discharge.
All your debts are gone, walkaway.
Maybe there's a payment plan,maybe not, but you get to get
your debts discharged.

(50:13):
So the ABC, the assignment forthe benefit of creditors, is
like a bankruptcy light, forlack of a better word.
The company chooses who will bethe person who they're going to
assign their rights to.
So imagine you have your ownrights as a person.
You just give them to someoneto be your power of attorney, or
like Brittany Spears givingthat power to her parents.

(50:35):
That's an example.
Exactly A conservatorship isvery similar to an assignment
for the benefit of creditors.
You're giving all of yourrights to this other entity and
they're going to deal witheverything.
So what we find with Slink'sfiling?
It's really sad.
They have about $1 million.
They have about $1,500,000 incash on hand and about

(50:55):
$1,500,000 in accountsreceivable.
They have a bunch of laptopsand then they have their
intellectual softwaretechnologies and they owe about
$1.5 million.
So whatever valuation they have, whatever amount of money they
brought in, that is.
All that's left Is about $1million in cash, bunch of
laptops and some intellectualproperty, and someone will buy

(51:19):
the intellectual property.
Someone will buy the laptopsand if there's money left over,
the shareholders, like GoldmanSachs, will get some of that
money.

So with the TQL incident the executives are on
the line for some of thatfinancial obligations, but not
in Slink's situation.
The executives are not on theline.

So Slink's situation.
Raising money and failing tomake a profitable company is not
a crime.
That's just bad luck as abusiness and your shareholders,
your investors, will lose outtheir money.
What Kirschner did is a crime.
If you say I'm going to usethis $25 million and I'm going
to hire the best developers outthere and I'm going to hire the
greatest marketing people youcan imagine, and then you say

(52:03):
put it in my personal bankaccount and I'm going to buy a
plane, that's a crime.
You're going to have problems.
He'll have to reimburse thecompany and it may or may not be
a good amount.
It probably won't be able to bereimbursed, like they'll sell
the plane wherever else he has.

I was going to say why don't they just sell the
?

plane.
Oh yeah, they'll selleverything.
They're going to sell it all,and he's probably going to go to
jail, I'd suspect, and thenthat money will go back to the
estate or the back to thecompany that's been assigned its
rights to some other entity andit might still survive.
Slink may still live at somepoint, but as of right now it's
not bankrupt, so it's stillalive as an individual business.

(52:39):
It's winding down.

I mean it's a lot.
But I also, especially when theconvoy news dropped, I just
couldn't help but think, becauseI went through a business
closure, an abrupt businessclosure asset-based 3PL 10 years
ago shut down abruptly and itwas so traumatizing to have
these outside bankers come intothe office and start dictating

(53:08):
what you should do, what emailsyou're allowed to send, just
dictating your role as anemployee.
And they start doing a lot ofshady things and you see all of
the TVs and the chairs and theprinters and the computers.
They start getting post-itnotes on them depending on who
they're going to sell all ofyour equipment to.

(53:29):
It's like you just watched yourentire life career-wise just be
put up for auction and you haveno control over it whatsoever.
So I have deep empathy foreveryone at convoy, at maybe at
Slink, if they're going throughthe same things.
What is there any positives wecan take out of these cases?

(53:52):
Is it maybe readjusting themarket back for better market
conditions?
For the rest of us who havesurvived, what does that look
like?

So the most effective companies in the space
are able to flex when marketsare good and when markets are
bad.
And I've been in transportationfor a minute, right, my dad's a
roadway guy.
My grandpa had a small fleet ofgrain hauling trucks Ebs and
flows is the business.
This is how it is.
The reality is we don't see apath to real recovery and

(54:26):
freight until at the earliest Q2of next year.
I've heard Q4 of next year.
I've heard even Q1 of 2025.
And if that happens, manycompanies will fail.
Many people experience what youexperience, which is watching a
company wind down, be auctionedoff, chopped up and pieced out
to make the shareholders andmake the debtors get their money

(54:48):
back.
I don't think there's any realsilver lining other than we must
have the capacity removed Comeheck or heck.
There's a great number ofcompanies that will not survive.

And, like you said earlier, the cream rises to
the top.

Yeah, this is the way it's always been.
Like that's.
The thing is like this is a badturn, maybe worse than two.
Maybe I'm part with 2008,.
But the reality is like this ishow it's always been.
It's always been feast famine,feast famine, and people get
sent home because the daythere's no work for you today,
and I think this will justencourage people when they look
to make jobs and make changesand look for companies that are

(55:25):
really stable.
Publicly traded multinationalcorporations are probably going
to be fine Like they're going tobe fine.
It's the small mom and pops,he's privately held, or any
company that exists off ofinvestor cash, and if the
business is all about like wefinished our series B and we
raised $10 million, that moneywill be spent in 12 months and

(55:45):
then you have to get more moneyand if you haven't shown the
thesis that you're correct inyour assumptions, that will go
bankrupt too.

So I guess sort of the next phase of this
conversation.
Hopefully you don't have to goany time soon.

I got to tell the world.
I just wanted to make surewe're good, we're good.

I wanted to say , too, that, unfortunately, that
company I worked for 10 yearsago closed down, but they were
also started in late 2008, 2009.
So they started in the middleof a downturn, probably one of
the worst freight recessionsthat we've ever seen.
So I do think that we're goingto see you know that that's
where the new businesses are.

(56:25):
Sort of what is the analogy?
That, like the forest fire,burns everything down, so new
growth can start.
So I think that that's probablya safe analogy moving into 2020
, 2024 and 2025.
But I also think it's a goodindicator.
If you are, you know, maybeyou're listening to this and
you're one of those unfortunateemployees for so long, sorry
that you're going through all ofthis but I also think that it's

(56:46):
an opportunity maybe to thinkabout entrepreneurialism, which
is, you know, something thatboth of us have taken the leap
on and you know, for you inparticular.
I'm just curious.
You know you have armchairattorney.

You are still a practicing lawyer or I am yeah,
absolutely, I practice, Idabble.

Okay, and what else do you have?
I know you've got a bunch ofother things going on.
So I wanted to talk to youabout that as well.

Yeah, so my background is eclectic, as you
kind of mentioned.
So the armchair attorney is alaw firm that I own and operate.
I have a very small client base.
It is my hobby.
I'm very clear about that.
It is a hobby to run my lawpractice Very, very limited
client base.
I like it that way.
I have a software company thatis for the inspection and repair
of commercial trailers, becauseI love trailers.

(57:34):
And then I am currently thevice president of sales and
marketing for a company calledContract Leasing Corporation, a
32-year-old trailer leasingbusiness with over 18,000
trailers in circulation.
I work underneath the founder,mike Gore.
It's a fantastic business and Ifinally get to put my love my

(57:55):
love of commercial trailers andmy desire to help people
understand things together, andso those are the things that I
do.
I'm a gecko enthusiast.
I have four children.
I have a 10-year-old, a7-year-old and I have twins that
will be one year on November15th.

I'm sure they are so cute.

They're ridiculous.
Oh, I have no idea what I'mdoing.

The favorite part of my Twitter slash X feed
is seeing the updates of yourchildren's growth progress.

They're walking now and they're making noises.
It's absurd.
It's not what I anticipated atall, but it's going fast.
They say the days are long, butthe years are fast.
These years are very, very fast.

So one thing that I don't hear people often
say is I love trailers.
So where does that stem from?

Oh my gosh, this is my most favorite thing
to talk about.
So I'd mentioned my father, aroadway guy, in 1976.
First job was night supervisorat their facility in Chicago
Heights, managing unionmechanics suit and tie every day
, every night.
Really.
It wasn't until 1991 that hehad a chance to bid on a garage

(59:06):
for a company called RPS.
So RPS instead of a roadwaypackage system.
So the old days, cf, which isFather of Freightways, roadway
and yellow were the truckingcompanies.
They were everything,everything we see today.
Like people say, oh, I'mex-Google, I'm ex-Apple, no, no,
no, are you ex-roadway, are youex-yellow?
Oh, I want to talk to youbecause that's interesting.

(59:28):
But our job with my father'scompany called Outsource Fleet
Services was maintainingequipment for RPS, and RPS only
had trailers and dollies thethings that connect the trailers
together when you have pups.
That company eventually becameFedEx Ground and so we were the
biggest vendor of maintenancefor FedEx Ground for 20 years

(59:51):
and what we did was we fixedtrailers for money.
So trailers are something that Ideeply, deeply care about.
Now we talk abouttransportation, and
transportation is really anexercise in trailers.
So something is made and it'sput into a container and in that
container is a type of trailertossed on a boat.

(01:00:11):
The boat brings it to a port.
The port takes it off the boatand either puts that container,
which I think is a trailer, ontoa train, which is a type of
trailer, or onto a chassis,which is absolutely a trailer.
Those things then go to adistribution house or warehouse
or a brake bulk center and theyget taken off the one container

(01:00:31):
and they get put onto a dock andthen likely into a trailer.
Now that trailer, thattrailer's journey, can go
anywhere like a truck stop or awarehouse or a distribution
center, and that stuff in thetrailer gets unloaded and then
put on a shelf or brought toyour front door, and so trailers
are all that matter in supplychain.

(01:00:52):
The track and trace of Project44 is the four kites.
All of these guys and gals arelooking for information about
the truck.
Where's the driver?
What's he doing?
Is he going to be there on time?
It's all a proxy for one thingthe trailer.
Where is the box with thethings that I want?
You asked me, matt Lefler, whatdo you want to know most about
the shipment that you havecoming in?

(01:01:13):
I want to know when it's goingto be here.
I don't care if the driver's onhis rest period or on his 10
hour sleep or birth.
I really just want to knowabout that box.
So there are five milliontrailers in the United States
Five million.
About 80% of those are dry vanswith swing doors.
So I love trailers.
I can talk about trailersforever.

Blythe Brumleve (01:01:33):
I love trailers .
You're kind of blowing my mindright now, because I just
assumed this is going to soundlike such a dumb question are
all semi trucks, technically,trailers?

Matthew Leffler (01:01:45):
So a truck is not a trailer.
I mean a truck is a proxy, it'sthe power source.
So in our business we ask to amotor carrier how many piece of
equipment do you have?
It's power.
Which is the truck?
It's either a box truck, it's astraight truck, it's a class
eight truck sleeper, or day cab.
That's the power unit.
Oh, okay, the trailer is goingto and the tractor trailer is a

(01:02:06):
term of art.
Tractor trailer means trailer.
So it means, like the 53 foottrailer, the 28 foot pop,
whatever, but the trailer is thething.
That is where all the freightgoes inside.
You can't put freight in thesleeper.
You got to put it all into thisbeautiful, beautiful box.

So well, I used to, because I have speaking of,
I have this book back herecalled the Box, which talks
about the revolutionary conceptof creating a container.

And how it Containerization absolutely.

It's the single greatest invention because it
brought the most people out ofpoverty all across the world
streamlined shipping andtransportation options.
So now maybe our trailer ismore revolutionary than the
container.

So containerization was about
bringing a process and a set ofdimensions that we all agreed
with.
So it's really funny because,like, we say containerization
but there's two types ofcontainers.
They're either 20 feet long orthey're 40 feet long.
So they come.
If you look at this stuff thatcomes out like on any board

(01:03:16):
about this data, they come TEUs20 foot equivalent units.
So a 40 foot container isactually two 20 foot equivalent
units, because it's just two ofthe 20s.
But so the container.
So in a container setting.
A container is like a marinecontainer.
It's intermodal, it can go tomultiple forms of transportation

(01:03:38):
, so it can work on a boat, itcan work on a train and it can
work on a truck.
So that's what makes thecontainerization model so
amazing.
You can get all of the cranesthat lift them up to be uniform.
That uniformity brings a levelof consistency that was never
there before.
It was always like, hey, I gotthis trailer full of floor
sweepers, like what do you wantme to do with it?
I don't know, move it to Dallas.

(01:03:58):
So this is why containerizationis absolutely one of the
biggest innovations.
But it was predicated on thechassis and the trailer and
being able to move those thingstogether.
So containers are in my mind, aform of trailer, and I think
the chassis that they sit on topof is also a trailer.

That was going to be my next question.
I'm like what's the differencebetween a chassis and a trailer?
So it's Okay.

so a chassis, a chas, this is beautiful.
This is like four more hours ofthis.
We're in good shape.
So a chassis is the subframeand the tires.
So a chassis really is just aBLT brakes, lights and tires.
It's beautiful and delicious Tohave the chassis pulled by the
power unit.
Whether it's a Drage company ormotor care, whatever they are,

(01:04:44):
that container gets onto thechassis and it gets locked
together with a pair of pins andthose pins make it so if it
doesn't fall off, because thatwould suck if it fell off.
So the main types of trailers inour country there's about maybe
700,000 to 800,000 chassis inthe United States.
Most of them are owned by threecompanies.

(01:05:05):
Those three companies are DCLI,track and FlexiVan.
Those three own 80% of allchassis in the United States and
likely in North America.
They are at the rails or at theports or everywhere.
Then there's like people whoown their own chassis, like JB
Hunt or Schneider, and there'scompanies like me, clc.
We lease them.
So I own about 3,000 chassis.

(01:05:27):
I lease them out to peoplewhenever they want them.
It's a really cool business.
And then the trailers, the bigvans and all that.
There's about, like I said, 5million of those guys and about
80% or 53 foot vans with swingdoors, because that's for truck
load.
And then, if you're talking LTL, it's pups, 28 foot pups with
roll-up doors.

How are they evenly?
I guess we said, you know,three companies own the majority
of chassis.
What about trailers?
Is it kind of the same dynamicsor is it more private?

That's a really good question.
I would say there is adisproportionate amount of
trailers owned by themega-carriers.
Those small fleets also have it.
So in the old days and I meanlike pre-deregulation you used
to have one piece of power withabout seven to 10 trailers.
So that was the dichotomy isyou'd have one to seven or 10.

(01:06:15):
As time has gone on, we haveconnected systems, we have
telematics.
There's not the need to have somany.
These days the margins tend tobe one power to probably one and
a half to three trailers.
So if you're a company, it's anasset-based company and you run
trucks, you probably have ahandful of trailers.
So it's the same kind ofdisbursement you'd have with

(01:06:37):
just power units.
Generally the vast majority oftrucking companies are less than
six trucks, but they're mostlypower only.
They're mostly just drivers andsleepers.
On the other side are themega-fleets that have hundreds
of thousands like extra-leaseowns 100,000 trailers in their
fleet.
Fedex has 100,000 trailers.
It has probably 200,000 if youcount the chassis, the

(01:06:58):
containers and the vans.

And I imagine this is where your software
comes into play.

Yeah, in software If you're ready to talk
about it.

I'm not sure if you want to.

Yeah, I'd love to.
My software stuff was a laborof love.
If you look at the numbers, onein five commercial vehicles on
the highway at any given timeare unsafe.
They're not legally allowed tobe on the road.
That's one in five, that's 20%.
If I said to you, hey, I havefive gallons of milk here, one

(01:07:28):
of these gallons of milk isunsafe, but I don't know which
one, You're probably going tosay, Matt, I don't want to buy
any of those milks.
And I'm going to say you don'tget a choice because that's all
that it is.
So my thought process as alawyer has always been if you
maintain things properly, youare going to have a lot safer
vehicles and a lot less injuries.

(01:07:48):
And uninterrupted freightdelivery is really important,
like on time, undamaged, safe iscritical.
So my software I incubated itwith Michelin last year.
We got our seed capital fromMichelin to build out the
prototype, the MVP.
That was finished in, I'd say,September, and over the last few
months we've been getting readyto deploy it in its initial

(01:08:11):
testing.
And it's really about schedulingtrailer services.
So the company's called LeflerTechnologies but the product is
called Trailer PM and the PMstands for Preventive
Maintenance.
Car Wash is a phrase, TrailerPM is the same sort of thing.
It's like you want to get yourtrailer inspected.
Well, I have people who caninspect your trailers and then

(01:08:32):
you can document it digitally,and it's just about making the
process of scheduling a serviceeasier, because most people
don't necessarily know how to doit.
And, having been a vet, I'vedone hundreds of thousands of
services with trailer companiesfor my career and I know a thing
or two about trailer and I loveit.

That's.
I mean, I just I'm sitting hereand I'm thinking back to like
2020, when we're all stuck inour offices and we can't go to
anywhere and we can't networkwith anyone, and so you see this
sort of just massive boom ofcontent creators within the
logistics space going on.
You were one of those folks andnow you have a whole ass

(01:09:09):
business, a whole ass softwareoffering SaaS product that
you've likely connected withother folks using content
marketing.
I just I think it's.
You have such a great story ofseeing what's going on in the
market, giving your perspectiveon it, and then seeing problems
that you can expertly fix basedon your experience and your

(01:09:32):
expertise, and then going anddoing it.
I think that's such a beautifulthing and I think that your
story is.
You know, as we started offwith the first hour of this show
talking about all the badthings that are going on, I
think more light should beshined on folks like yourself,
who did it the bootstrapped way,who have a business that will

(01:09:52):
probably be profitable likeright from the jump.
I just you know,congratulations on all the
movements and things you've beendoing, and I just I think it's
the power of content marketingin this space.

I appreciate that I learned a lot from you.
Like you don't know that, butlike I we've talked about this
before, but you were one of thefirst people out there who were
making consistent content thatwas really interesting and
useful.
Like I didn't watch freightwaves most of the time, I
watched your content becauseyou're good at what you do.
I found it to be cathartic forme, like I started off making
things that were just for me.

(01:10:26):
Like, if you find my earlieststuff, it's really really,
really rough, and that's okaybecause I found joy in the
process.
What I found the mostinteresting over time was the
amplification of importantthings, and so we talked about
the TQL thing as a good example.
The Echo and the CH Robinsonlawsuits around

(01:10:47):
misclassification those areforgotten.
No one knows.
I mean industry folks that arereally involved know, but young
brokers have no concept of this.
The power we have in our voicesto talk about things that
matter is incredible, and peoplelike you can put their thumbs
on the scale and put outmessages that people in the past

(01:11:07):
could never hear.
So this has been like anamazingly positive part of the
journey.
I will say that I don't viewmyself as a content creator or
an influencer.
I look at myself as a megaphonescreaming into the void and,
like some people listen, they go.
Man, I love that thing, somepeople don't.
I assume no one listens toanything that I do.

(01:11:28):
But then I get feedback andpeople reach out and they say
I've enjoyed it, I like it, Iwant to learn more, and the more
you dig into this industry,it's fascinating and it's also
very depressing.

I say on the show all the time, we have so
many stories to tell, so manyand within your own organization
, of what kind of freight you'removing and versus like the
stories that you're telling andshining a light on, I'm curious
if there's any underlying, maybelegal issues or crime stories.
Fraud is obviously a huge issuegoing on within the industry.

(01:12:02):
Is there anything that weshould be paying more attention
to that isn't getting a lot of?

knowledge.
Yeah, so there's so much, andI'll say that the one case that
I'll start with is when Ibriefly alluded to, called
Werner Enterprises, and it'sdown in Texas.
This story you've probably seenit, most people, your viewers,
have probably heard about this.
But the story goes truck driveris driving in the snow and he's
going 50 miles an hour underthe posted speed limit, never

(01:12:29):
loses control.
In the opposite lane, oppositeside of the direction of traffic
, another pickup truck isdriving.
That pickup truck loses control, crosses the center line,
smashes and head first into thatWerner truck.
One child dies, another childis permanently injured.
Question is who's at fault?
Who's responsible?

(01:12:52):
It goes to trial.
It goes to trial and Werner isfound to be 70% responsible.
70%.
This is a truck and companythat never lost control of the
asset under the posted speedlimit.
The verdict the verdict $98million, 98 million.
And here are the facts that werenot in Werner's favor.

(01:13:12):
The driver had been driving forless than seven days, brand new
CDL driver.
The trainer was asleep in theberth.
I wasn't paying attention.
The dispatchers hadn't warnedthis driver about driving in bad
weather.
This driver had never driven inbad weather and he was told you
must make this time you mustmake it there.

(01:13:33):
So why this case is sointeresting right now is one
should anyone expect someoneelse to lose control of their
car in the opposite side oftraffic and hit you and you
could be responsible?
That's crazy, that's bonkers,it's absurd.
More importantly, if you arefollowing this thing called F4
preemption the idea of brokerliability you could be a broker

(01:13:55):
who brokered that truck to movethat load.
Let's say it's not Werner,let's say it's some random
trucking company.
You, mr or Mrs Broker, could bethe one who gets sued for $100
million and you would have noway to protect yourself.
So this thing is going to theTexas Supreme Court.
It will go there and that'swhere it's going to live and die
.
It can't go to the US SupremeCourt.
It's a state issue only.

(01:14:16):
But if this type of stuffhappens, werner self-insures for
$10 million.
They have an umbrella policyfor anything above $10 million.
With the interest we talkedabout, they're over $115 million
right now.
This case should make everybodygo.
What.

Yeah, I cannot believe that that would even be
something that could be broughtto trial.

So Werner thought that that the same thing
.
Werner thought they were goingto do a much.
They're going to get a dismissand say look, this is no,
there's no legal liability forus, because our guy was going
safely.
He wasn't.
He didn't lose control, hedidn't go crashing someone else.
Someone else, like literallyfrom the other side of the road,
smashed me and they made thecritical error that any lawyer
who worked their medal and Idon't want to put slag at other

(01:15:03):
lawyers you never go to trial ifthere's a dead child involved
you just don't do it Like itdoesn't matter what the jury
hears you say.
All they're going to say is howmuch liability insurance did
the pickup truck driver have?
Oh, like $100,000, $200,000.
How much do you have?
Oh, unlimited.
Yeah, this kid's going to needtherapy for us their lives.
This mother lost her son.

(01:15:23):
Like this is why you don't takethose cases to trial.
But Werner may, may besuccessful on appeal hard to say
.
But if that stands, theliability insurance that people
are going to have to buy isgoing to be very expensive.
It's already very expensive.

It's a lot.

Isn't it heavy?
It's a lot we covered it's soheavy.

I know, I know I do feel like I have to say
that I mean, obviously, thatstory is tragic and it's
something that could be industrychanging along with the TQL
verdict.
I'm tired of talking aboutthese depressing stories.
I don't know how to segue intosomething a little bit more

(01:16:07):
lighthearted.

More positive.
I thought we did.
I mean, the thing is like thetrends I think are important
Things to note for all youraudience is if you're a worker,
you have a lot of rights.
You don't know about thoserights.
Schools need to do a better jobof educating people about what
their rights are, especiallythings like non-competition
agreements and how to negotiatethose things.

(01:16:30):
I feel like we are seeing as theindustry continues to be in
this dark slump.
There are positive thingscoming from this.
There's more accountability andwe're seeing the fraud Like in
the good times.
You don't see the fraud, youdon't see the theft.
You just see everyone making abunch of money.
When the tide's lower, everyship begins to sink and you can

(01:16:53):
see who the bad apples reallyare, and that's important.
I mean we all have to behavelike someone is watching us,
because someone probably is.
So I think there's somepositivity coming out of this in
so far as it's showing us theactors we didn't like, like TQL,
are actually worse than wethought, which is great.
Really, really, reallyconfiding.
I don't think you're going tobe invited to any TQL events

(01:17:16):
anytime soon.
They won't let me follow them onTwitter.
I'll be honest with you.
I've tried.
They won't let me.

They will not.
I thought they had their tweetsprotected.

They do.
I can't even look at them.
For a while I was harassingthem on LinkedIn.
I would say harassing, it's notthe right word.
I was engaging with them.
They weren't very big fans butfor some reason, if I ever go
and look like who's looking atmy profile, it's a lot of people
from TQL.

It's a lot of people, poor social media
manager.
Just let me post in peace.

We just gave them a great thermos.
Why are they talking aboutnon-competition agreements?

Where are we at with non-competition agreements
?
Is that an issue still?

Yeah, I mean.
So for those of you who've beenfollowing this, there's been
this thing called the FederalTrade Commission and they put
out a proposed rule that wouldban non-competes for everybody.
So let's talk about somestatistics.
About one in five 30 millionAmerican workers have a
non-compete 30 million people asa condition of employment.
About 30 to 40% of those peoplemake under $15 an hour.

(01:18:19):
So it's a really interestingthing.
They are disproportionatelyaffecting all sorts of different
protected classes.
The history of these things isalso fascinating.
But the FTC came out and saidlook, we believe that because of
non-competes, american workersare making $300 billion less a
year than they're supposed to be.

(01:18:39):
Because the non-compete makesyou can't go and get another job
or make your own company, so itartificially depresses your
compensation.
So the FTC said we're going toban these things and over 20,000
comments were made.
One of them was made by theAmerican Trucking Associations.
They believe they're great, gofigure.
But the FTC will have a finalrule, probably next year, and

(01:19:03):
it'll likely ban non-competes.
The problem is that it isunlikely that the Supreme Court
would allow that type of rule topass.
So there's this thing and thisis going to be esoteric, so I
apologize.
There's a thing called thenon-delegation doctrine.
All it means is, if you'reCongress, you shouldn't give
authority to an administrativeagency unless you've expressly

(01:19:27):
said that.
And the case I'll use is youmight remember, during COVID,
osha said we're going to mandatevaccinations for people with
over 100 employees.
And everyone was like what,when did OSHA get the authority
to mandate vaccinations?
Like, who gave them thisauthority?
So that was sued.

(01:19:48):
It went to the appellate courts, went to the Supreme Court.
At the Supreme Court they askedthe question does OSHA have the
authority to mandatevaccinations?
The liberal minority said yes,they can.
The conservative majority saidno.
No, if you want to give peoplevaccinations, go back to

(01:20:10):
Congress and ask them to mandateit.
Don't come to us and make us doit.
So that is the example of thenon-delegation doctrine.
So the FTC is gonna put out arule and say we wanna ban
non-competes.
What American businesses aregonna say is why are you getting
involved in a contract betweenme and my employee?
They can choose not to sign it.

(01:20:30):
I don't make them sign it.
Why are you getting involved?
And the Supreme Court in thisenvironment is likely to say go
back to Congress and ask forsomething.
So there is another thing.
It's called the WorkforceMobility Act.
It is a bipartisan piece oflegislation in both the Senate
and the House that is stuck incommittee.
That would ban non-competes aswell.

(01:20:52):
If that were to get passed andsigned, that would ban them and
it would be okay.
I think the FTC's action islikely not gonna be effective.
I think it's gonna beoverridden.
I don't think it's gonna belegally enforceable.
I could be wrong, but our courtis very conservative and very
hostile to things like this.

And I've heard of even fast food workers Like
if you work at a sandwich shopyou're being forced to sign a
non-compete so you can't go workat another sandwich shop.

So that was the Jimmy John's case.
This is great, the greatsandwiches, freaky fast.
They also had freakynon-competition agreements,
these guys.
They had a two-year non-competethat would affect anybody
within three miles of a JimmyJohn's store.
So if you work for Jimmy John's, you can't work anything within
three miles of a Jimmy John's.
If that company had 10% oftheir revenue coming from like

(01:21:39):
cold sandwiches and they weresuing, they would sue people.
Trunk Club in Chicago, like youwould send us your dimensions,
will send you outfits that lookreally nice.
The designers, non-competitionagreements.
You can't go work for anothercompany designing outfits.
It's pervasive.
This is the thing that I thinkis this is towards the end.
I like this part.

(01:21:59):
So the history of non-competedlife.
Have I ever talked about wherethese things came?

from.
I don't think so, but it soundslike some kind of like
corporate America BS.

Oh, it's so much worse than that.
So after the civil war, we hadthis freeing of indentured
slaves.
We freed the slaves and one ofthe things that the South did
was say, well, how can weprevent our former slaves, now
workers, from going and workingsomewhere else?
Non-competes began.
They began as a method tocircumvent the slavery of

(01:22:34):
abolition.
They became the way you'd sayyou can't go work over here.
I have been trying for my forlast year or so for people to
understand that non-competedagreements are not about
contractual rights betweenworkers and their bosses, though
they are.
They are an aspect of diversity, equity and inclusion, because
they were designed and theydisproportionately affect people

(01:22:56):
that are in protected statuses,cause we knew what we were
doing.
We knew exactly what it was.
You're not gonna go work at theneighbor's plantation because
he'll pay you 25 cents an hourmore.
You're gonna work here.
If you go there, I'll sue youand the old days, like you could
.
A lot of things would happen inthe old days.
So these things exist becauseof that.
That is their history, andcompanies who don't understand

(01:23:19):
or do understand and just don'tcare.
They're wrong.
They're wrong, but that's theprice?

Why treat your employees better, you?
Could just sue them intooblivion or scare them into that
.
You're gonna threaten legalaction.

Absolutely.
We look at TQL as like theposter child.
They sue everybody.
They hire people knowing that95% will not stay.
Those 95% will never get a jobin transportation, at least for
a year, because they're not incompete.
And they also steal from theirworkers, like if any company
should fail, it should be them.
That they're not going to cause.

(01:23:54):
They're making a bunch of money, so very fun.
That's why they're inviting meto their cocktail party.

I don't think you're gonna get an invite
anytime soon, and I think itreally is an important thing,
because think of all of thosepeople that we turned away from
the industry that maybe couldhave found a really good home
and excelled and made a reallygood life for themselves, and
instead they were put throughthe meat grinder, as you say,
and now they'll probably nevercome back because of the way

(01:24:25):
they were treated.

And this is the thing I think is so diabolical
is it means that you're notgonna become an entrepreneur,
you're not gonna be able to growin this space.
We want talented people thatare excited about this business
and we do everything to make itimpossible.
And so I look at this and I getexcited because people are
finally talking about it andthey're finally motivated, like

(01:24:50):
the people that I hear from allthe time.
They're pushing back and I likethat, but it is a very dark,
dark chapter in our country andI look forward to the day that
non-competes are gone.

All right, couple last questions yeah.

I'm, so I try to be excited and happy.
We're just talking about themost depressing things in the
world.

We have to talk about these things right,
Because education is powerfuland the more you know, the
better situations that you canput yourself in, you can put
your clients in, your businesspartners in.
So it is better for theindustry to sort of shine a
light on a lot of the pardon, myFrench, the fuckery that's
going on.
It's so bad.
it's so bad Corrected becauseotherwise these shady actors

(01:25:32):
which there's always been shadyactors, and transportation since
the dawn of time, being able toshine a light on them, to weed
them out, so the cream rises tothe crop, is sort of a I guess,
a theme of today's episode.
But one final question were youone of the 30% of people that
actually made it through allepisodes of Rings of Power?

Those are hurtful words and of course I
did.

I did too.
I did.
I'll say I think I said thatstat wrong real quick.
67% of people who started Ringsof Power never finished it.
That is an astonishing stat fora TV show that had a billion
dollars put into it.

Yeah, there's a big hole in my heart, almost
the same size as the plot holeswithin Rings of Power.
I know it's got problems, Iknow I do.
I hope that we get to hearstories that were never told and
never even contemplated byTolkien, like in the far far
west, like in the, like, maybethe blue wizards we get to see,

(01:26:37):
Like I'm hoping.
Can we talk spoilers?
If you're not talk spoilers?

I don't know what your audience?
First of all audience.
Don't waste your time watchingthis garbage show.
Just go watch the movies.
Read the books, watch somequality programming, the
extended editions, watch that Ihope that's not Gandalf.

It should not be Gandalf.
He was not there in the secondage, he was there in the third
age.
There's no point to have himthere.

I think, the reveal of Sauron was.

I liked it.
I liked that part of it.
Galadriel is far better in thebooks and in the movies than in
the story.
She seems like a petulant child.
I did not like her as acharacter at all.
It was very disappointing.

The abomination Is what they did to Galadriel.

She's one of those powerful elves alive.
She existed.
Smart wisdom.

You didn't need to put a sword in her hand for
her to be considered strong.

She's giant, she's like six feet tall, she's.

Her hair was not a raggedy mess like it is in
Rings of Power.
Her hair is literally comparedto the light of the two trees.

Yeah, that's what it was Exactly right.
Feanor asked for her hair andshe denied him.
Gimli asked the right times.

I think she denied him.

It's right.
Gimli asks one time and he getsthree hairs.
Like that is incredible.
That moment when I was watching, I teared up.
I'm like that is amazing.
The Balrog should not have beenshown and Duren's Bane has
nothing to do with the secondage.
This is more like fan fictionat this point.

No, the Balrog, you have Elron walking to the.
Where did he walk to?
And, like dress robes, theytook no water, they took no
supplies, they just casuallytook a little walk.

Me thrill does not come from lightning strikes.
I am fundamentally like that isthe stupidest thing.

And you know what too, the forging of the
range would have been so greatto show, except for they showed
it in the wrong timeline.
They put Galadriel there whenshe wasn't there in the forging
of three rings, and then theymade it that you have the Sauron
.
I don't know like it was agreat value.
Sauron, that is essentiallytelling the world's greatest

(01:28:54):
Smith how to mix metals, andit's like this is basic.

Yeah, yeah, metalers.
You never heard of that.

Basic knowledge that he should have.
And yet you have this greatvalue Sauron coming in to save
the day.

I think it was like the nine rings that went to
the men and the seven went tothe dwarves, like those rings
were all made first.
Like the three rings the elveshad were not made anywhere near
Sauron being there.
He left.
He was, he did not know theywere making them and he gave all
those rings to the elves andthen the elves put them on and
he put his one ring on them.
They're like oh, take them off,we don't want this.

(01:29:29):
So I'm gonna watch it Like I'mgonna watch the next season.
I'm probably gonna hate watchit too.

That's right, that's right and I'm gonna be so
mad.
I've never been so justWatching any show, ever.
I've never been so mad, really,just angrily turning it on.
Like it got to the point where,like my fiancee watched the
first episode with me and hefell asleep during the middle of
it, woke up and he just sees melike just seething, just mad,

(01:29:58):
and he's like who Rage?
Never watched another episodewith me.
But I guess you know, I guessyou know, following a similar
format to the rest of the show,we start with the bad and then
with the good.
We do have, you know, some sortof nature's healing moments
where Peter Jackson is comingback to the Tolkien Middle Earth
universe.
I didn't know this.

(01:30:18):
He's making an animated show,sort of a Lord of the Rings
anime style of the war Rohirrim.
So the writers of Rohan, that'sgoing to be the show that he is
making next.

I wanna pitch to you a watch party that we do
for Ring of Power.
That'd be great.

I think the fans would be so excited for the
opportunity to listen to ourarticulate you wanna see me like
break a bottle on the ground?

This was just pouring just tons and tons of
drinks.
It's like that's gonna be fine,we're gonna keep going.
It's gonna be amazing.
I can't wait.
I can't wait.

I like chaos, so I'll do it.

What's your alignment?
You chaotic, neutral.

What do you mean?
What's my alignment?

Like oh, you never played D&D.

Oh no.
I didn't Okay, that's one nerdculture that I did not get.
It felt very.
I did love the movie.
I saw the movie recently.

I had not seen the movie.
I wanna see that movie.
I didn't see the movie.

The movie is really cute, it's funny, it's
got, all it's good.
But I never got into D&D.
It just wasn't my thing, so I'msorry.

Yeah, I can understand that.
I played in a basement rollingmy D20.
And it was very cool.

I do think the culture around that is really
cool, like I just saw it.
Speaking of which, I just saw aTikTok creator who, like,
specializes in making a holderfor all of the dice and your, I
don't know.
It looked cool.

Yeah, I have a whole bunch of dice.
You need like a four-sided die,a six-sided, a eight-sided,
12-sided.

Well, this, I mean it had magnets and
everything in it, so it lookedvery nice.
So I love the culture of D&D.
It seems like they have areally powerful little you know
fan world to live in.
But I live on the Lord of theRings side of things.
I was on the Star Wars side ofthings for a very long time and
I'm a little distant.

I like the next generation, Next generation
Star Trek with the card.

Star Wars.

Oh, star Wars, I like the Star.

Trek Star Wars.

Is that on that Boba Fett guy, best bounty
hunter who then became a localcrime lord?
That show is depressing.

No, he didn't really become a crime lord.
He came nothing Like he justdid nothing.

Let's take the most exciting character, an
interesting character, bring himback to life and let him run a
small like-.

And then not even put him in two of his own
episodes.

In his own show , and no one wears cool helmets.
Just let him walk around and-.

Just bring Mando back, baby Yoda, and then
he'll solve everything.

And he was also what was in Game of Thrones.
He was, oh man, the guy fromDorne.
Yeah, oberon Martel, oberon,tyrell.
No, not Tyrell, it was notTyrell.

Martel, oh Martel.

Maybe I don't know, tyrell's word.

Margery.
Yes God, what is her name?
The older woman who had thatgreat line, Tel Cersei, it was
me.

Oh yes, oh God, these names I should know
better in a minute.

All of these fake world histories that we
know.

People are gonna be listening for that part
and they're like wait.
They're like they're gonna tryto remember these different
fantasy worlds and they're gonnabe like this is the best part.

No, they're just sort of all meld together.
But yeah, I would say Game ofThrones like Westerosi is
definitely.
I would say my rankings andthen I want to hear yours.
So I would definitely do Lordof the Rings, game of Thrones,
house of Dragon, and then I'dprobably go Harry Potter still,
and then maybe Star Wars.

(01:33:35):
I think that that's my nerdfandom hierarchy.
And Marvel.
I gotta put Marvel in there too.

I've become a Narmoth Castlevania.
Like there's a lot of goodanime stuff.
Like I played all the gameslike Symphony.

Knight.

So I really love those.
I'm really loving the boys andGen V stuff too.
That is on Amazon it's supercool stuff.
Very cool For me.
Lord of the Rings takes it in abig way.
I think if we stay in the samefantasy world, Dragon Lance is
also really, really good.
These were like there'shundreds of books of these

(01:34:10):
characters that were in likemedieval kind of stuff.
It's so good.
Oh, I had so many books when Iwas a kid and then I'd say Game
of Thrones, I like Game ofThrones.
I didn't like the writing verymuch in Game of Thrones.
It just seemed, I don't know.
I liked it for the most part,but I got to a point where it
reminded me of the Silmarillion,like just history stuff, and I
just didn't like that.

And I hated the .

Silmarillion.
I hated that book.

It is a tough read, a very tough read.

It's a history book without any real things
happening.

This.
I haven't picked up that book.

I don't know since I was a teenager, but
there are so many cool storiesLike Glorfindle killing a Balrog
by himself, like that, orFaeanor fighting a bunch of
Balrogs, like there's greatstories, but yes, they're
difficult.

That's why I like the guide books, like the
handbooks that like explain whatdifferent things are.
Like I used to be, I used tohave the guide book, like the
Almanac, almost, or theThessaurus, whatever it's called
, or the guide to Middle Earth,and then I would be reading it
at the same time and I'd have tolook up what each thing meant,
and then I started just readingthe guide book after that, Well,
there's Fandom has a great setof information about it.

And then Nerd of the Rings is also like a
YouTube channel Fantastic.
I love his content.
It's excellent.

Yeah, there's a lot of different.
Like YouTube, when the YouTubesphere I first started getting
into YouTube because of Game ofThrones, so I would watch all
the history lore videos on there, and then the I would say New
Glass F-Full with Rings of Power.
Coming back in the YouTube era,it led to so many new YouTube
channels covering it.

(01:35:43):
But it also, like you know,emergency awesome or like a
screen crash or you know theseguys that I watch specifically
for, like their Star Wars takesor Marvel takes.
I started listening to them onthe Lord of the Rings or the
Rings of Power, and I'm like nowrong, Like are you with them in
the bathroom?
That's not real, You're wrong.

Wrong Charlie?
No, don't like it.
Don't like it.
I hope we see maybe TomBombadil or someone really neat
would be cool.
Like to see some like.

I don't trust Amazon to do.
If Peter Jackson couldn't dothat character justice, I damn
sure don't trust Amazon to dothat justice.

It's hard to explain.
You're right, I don't thinkwe're gonna see that I look
forward to.
Like the falling of Numenorwill be interesting, like the
way that it fell in the books isreally interesting, and if we
see that same sort of thing.
We saw that she had a vision ofit happening, so that's gonna be
really cool.
She can see.
I love it, I liked, I enjoyedit.
I did not like any of thecharacters at all, but I did

(01:36:42):
like the fact that we have theworld of hobbits again, kind of
God, they were the most annoyingthing, little jerks.
We're a fairly good meeting.
One person gets injured.
They just leave them behind.
They leave you behind, yeah.

Very slowly walking away.

Yeah, they're all monsters Like.
I don't doubt you.
That's where probably Schmeeglecomes from.

I suspect they settle down on a river somewhere
Makes sense.
They're evil in their bones andthey take branches to their
head and think that it'scamouflage.
I just anyways, I don't know.
I've already said enough nicethings about rings of power.

So we gave them the eyeballs.
We needed to give them eyeballs, and I think it's important
that our culture knows how greatTolkien was, even if they
forget the books ever existed.

No, they need to remember how good the books
were and how.
I think that Tolkien was maybeone of the last creators to
devote his entire life tosomething.
Maybe George Lucas, of coursetoo, and George RR Martin to an
extent, maybe JK Rowling as well, but Tolkien devoted his entire
life to creating this universeand just maybe completed 60% of

(01:37:52):
it.
It was really up to his family,his son, to be trusted with
respecting what he wanted forthat lore and then to continue
to build on it, and that's whatI hope.
As far as overall, just ringsof power in general, I hope that
it creates other things thatare more faithful to what
Tolkien originally envisioned,and especially if, as AI

(01:38:16):
increases and the capabilitiesfor some of these smaller
creators to really be able tomake a fan fiction, that is good
.

If your head set on you can live in that,
that would be amazing.

I'd be ready player one.
I'd just never leave the house.
I already got the Gandalf stuffhere in the back that I could
take with me.

Just screwing you shall not pass.
I have that sign on my officedoor.

It doesn't work , by the way.

I think when, if we do see the FMCSA put out a
speed regulator of 68 miles anhour, then you can, you shall
not pass in the back of atrailer would be fantastic.
Everyone would be so happy.

That's perfect.
We tied it.
You found a great way to tie itall together with all the drama
that's going on in freight, allthe drama that's going on in TV
.
It's a good opportunity to useplatforms like this to be able
to talk to experts like yourselfand be able to get just a
clearer head about what the hellis going on in the industry.
So hopefully next time we haveyou on the show.

(01:39:14):
It's not much time passes, buthopefully we're talking about
less drama and more fun things,about trailers and cool stuff
going on in freight.

I hope we can do that.
I will say it's gonna be a verydark few months.
We're gonna see a lot morechaos and a lot more interesting
companies not doing so well,but we will have good things to
talk about and anytime I cancome back black you know I'm a
fan.

Well, until then, where can folks follow you
?
Follow more of your work.

Oh yeah, you can find me on LinkedIn, Matthew
Leffler, my law firm,armchairattorneycom.
Tiktok, I'm armchairaddyatty.
It's not particularly good, butthere's lots of Gecko videos on
Twitter or X armchairaddyattyATTY is the abbreviation for the
word attorney, and if you'reever thinking about trailers,
you're thinking oh man, I wish Ihad more, I wish I had less, I

(01:40:03):
wish I knew more about trailers.
I buy them, I sell them, Ilease them, I like to look at
them and talk about them.

That's a hell of a way to end the show,
matthew.
Thank you, I hope you enjoyedthis episode of Everything is
Logistics, a podcast for thethinkers in freight, telling the
stories behind how yourfavorite stuff and people get
from point A to B.
Subscribe to the show, sign upfor our newsletter and follow
our socials over ateverythingislogisticscom.

(01:40:32):
And in addition to the podcast,I also wanted to let y'all know
about another company I operate, and that's Digital Dispatch,
where we help you build a betterwebsite.
Now, a lot of the times, we handthis task of building a new
website or refreshing a currentone off to a co-worker's child,
a neighbor down the street or astranger around the world, where
you probably spend more timeexplaining the freight industry

(01:40:54):
than it takes to actually buildthe dang website.
Well, that doesn't happen atDigital Dispatch.
We've been building onlinesince 2009, but we're also early
adopters of AI, automation andother website tactics that help
your company to be a centralplace to pull in all of your
social media posts, recruit newemployees and give potential

(01:41:14):
customers a glimpse into how youoperate your business.
Our new website builds start aslow as $1,500, along with
ongoing website management,maintenance and updates starting
at $90 a month, plus some bonusfreight, marketing and sales
content similar to what you hearon the podcast.
You can watch a quick explainervideo over on digitaldispatchio

(01:41:36):
.
Just check out the pricing pageonce you arrive and you can see
how we can build your digitalecosystem on a strong foundation
.
Until then, I hope you enjoyedthis episode.
I'll see you all real soon andgo Jags iße.

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