Cleveland Browns owner Jimmy Haslam is being investigated by federal officials in relation to a legal battle between his company and Warren Buffett’s Berkshire Hathaway.
According to a report from Bloomberg, federal prosecutors are investigating an allegation by Berkshire Hathaway that Haslam tried to bribe more than two dozens employees from his Pilot truck stop chain to get them to inflate the company’s profits. Berkshire alleges that Haslam’s goal was to increase the value of Pilot so Berkshire would have to pay more to purchase the remaining stake in the company from the Haslam family.
Berkshire currently holds 80% of Pilot Travel Centers. Buffett’s company bought 38.6% of Pilot in 2017 for $2.76 billion and increased its position to 80% this year for an additional $8.2 billion. The Haslam family has an annual option beginning on Jan. 1, 2024, that gives it the right to sell the remaining 20% to Berkshire. The Haslams have 60 days from the start of each year to decide whether to sell their remaining 20%.
In October, Haslam filed a civil lawsuit against Buffett alleging Berkshire tried to devalue the remaining 20% of Pilot in order to decrease the amount Berkshire would have to pay to acquire the remaining shares. The Haslam family alleged that Berkshire tried to do that by way of accounting changes that were made without Pilot’s consent.
Berkshire responded to the lawsuit by alleging Pilot tried to artificially inflate profits.
The Haslam family has owned the Browns since 2012. Jimmy Haslam also recently completed a purchase of a stake in an NBA team.
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