Pride Group, one of the country’s major trucking carriers, has sought bankruptcy protection following a $100 million lawsuit filed by lender Mitsubishi HC Capital America.

The company filed for creditor protection under the Companies’ Creditors Arrangement Act (CCAA), granting it a 10-day stay of proceedings. In a news release, Pride Group explained that this step was taken to initiate CCAA proceedings and seek recognition under Chapter 15 cases. Their goal is to maintain current operations, stabilize the business, establish governance controls, and develop a restructuring plan for the benefit of stakeholders, including employees, customers, and business partners.

The bankruptcy protection filing followed lawsuits from Mitsubishi HC Capital, accusing Pride Group’s Sulakhan “Sam” Johal (President and CEO) and Jasvir Johal (Vice-President) of defaulting on personally guaranteed payments. Mitsubishi HC Capital is pursuing $100 million in damages through these legal actions.

Pride Group, headquartered in Mississauga, Ontario, operates as a North American truckload carrier with a fleet of 391 tractors and 1,200 trailers. Their terminals are located in Ontario, Quebec, Alberta, and Illinois.  Pride Group Logistics ranked as the 20th largest Canadian for-hire trucking company in the 2023 Today’s Trucking list of the Top 100 fleets. 

Alongside Mitsubishi HC Capital, more than 20 other lenders have also filed claims totaling $637 million against Pride Group, as documented in filings with the U.S. Bankruptcy Court for the District of Delaware. 

These lenders include Daimler Truck Financial Canada, Daimler U.S., Paccar Financial, and Volvo Financial Services Canada. 

The situation underscores the challenges faced by the trucking industry and the financial complexities involved in managing large fleets.