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Note 13 - Commitments and Contingencies Liabilities | 12 Months Ended
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Dec. 31, 2018
Notes to Financial Statements |
Commitments and Contingencies Disclosure [Text Block] |
13. | COMMITMENTS AND CONTINGENT LIABILITIES
From time-to-time, we are a party to ordinary, routine litigation arising in the ordinary course of business, most of which involves claims for personal injury and/or property damage incurred in connection with the transportation of freight. We maintain insurance to cover liabilities arising from the transportation of freight for amounts in excess of certain self-insured retentions. In management's opinion, our potential exposure under pending legal proceedings is adequately provided for in the accompanying consolidated financial statements. Our Covenant Transport subsidiary is a defendant in a lawsuit filed on November 9, 2018 in the Superior Court of Los Angeles, California. The lawsuit was filed on behalf of Richard Tabizon (a California resident and former driver), who is seeking to have the lawsuit certified as a class action case wherein he alleges violation of multiple California wage and hour statutes from October 31, 2014 to present, including failure to pay drivers separately for rest breaks, failure to provide itemized wage statements, failure to pay minimum wage (for on-duty not driving time), waiting time penalties, and failure to reimburse for business expenses. Tabizon is also seeking Private Attorney General Act (“PAGA”) penalties based on these claims from September 11, 2017 through the present. The case was removed from state court on December 6, 2018 to the U.S. Federal District Court in the Central District of California. Based on our present knowledge of the facts and, in certain cases, advice of outside counsel, management believes the resolution of open claims and pending litigation, taking into account existing reserves, is not likely to have a materially adverse effect on our consolidated financial statements. We had $36.3 million and $32.9 million of outstanding and undrawn letters of credit as of December 31, 2018 and 2017 , respectively. The letters of credit are maintained primarily to support our insurance programs. We had commitments outstanding at December 31, 2018 , to acquire revenue equipment totaling approximately $156.3 million in 2019 versus commitments at December 31, 2017 of approximately $51.7 million. These commitments are cancelable upon stated notice periods, subject to certain adjustments in the underlying obligations and benefits. These purchase commitments are expected to be financed by operating leases, capital leases, long-term debt, proceeds from sales of existing equipment, and/or cash flows from operations.

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