A California company, which once contracted with FedEx Ground to deliver packages before filing suit against the global delivery giant (NYSE: FDX) in November over alleged illegal business practices, has filed for bankruptcy liquidation.
PYNQ Logistics Services Inc., doing business as PLS Inc. of Pleasanton, California, filed its petition Wednesday in the U.S. Bankruptcy Court for the Northern District of California.
In its petition, PYNQ lists its assets of up to $50,000 and its liabilities of up to $10 million. The company, which has up to 49 creditors, maintains that no funds will be available for distribution to unsecured creditors after administrative fees are paid.
As of publication, PYNQ’s attorney, Trang Do, did not respond to FreightWaves’ request seeking comment.
The largest creditors with secured claims listed in the petition are Byline Bank of Washington, DC, owed more than $460,000, and Magarino Enterprises Inc. of Crescent City, California, owed over $385,000.
The petition, which lists Tara Wright as president, states that Byline Bank repossessed four of PYNQ’s delivery trucks in March.
The largest unsecured creditors include Wayne and Tara Wright of Pleasanton, owed more than $213,000; Possinger Law Group of Woodinville, Washington, owed nearly $67,000 for legal services; and Nick Barbieri Trucking of Ukiah, California, owed over $21,000.
According to PYNQ’s financials, the company did not operate in 2024. Its petition states the former FedEx Ground contractor made nearly $527,000 in 2023 and over $1.6 million in 2022.
FedEx Ground litigation
According to court documents, PYNQ sued FedEx Ground, alleging the unit violated the Racketeer Influenced and Corrupt Organizations Act (RICO) by fraudulently inducing the company to enter into a contract with the understanding that it would be independent but was instead subject to controls that required it to function like an employee.
Former airline pilot Tara Wright founded PYNQ in 2021. She invested nearly $1.13 million to become an Independent Service Provider (ISP) and bought two FedEx Ground delivery routes on the California-Oregon border.
However, in May 2023, after several attempts by PYNQ to renegotiate its contracts, the suit alleges FedEx Ground sent termination letters to PYNQ regarding its contracts and claims the delivery giant sold one of its contracts — the Eureka route — without PYNQ’s consent and also failed to compensate the contractor. The suit also alleges there was no time to sell the second contract — the Brookings route — which was not profitable without the Eureka contract. Court filings allege that on May 17, 2023, the last day of the contract, the new ISP for FedEx Ground had started recruiting PYNQ’s drivers without Wright’s knowledge and before she was able to notify them about the contract terminations.
Approximately 7,000 contracted small businesses operate in FedEx Ground’s network.
A creditors meeting has been scheduled for June 25.