Former Celadon Executives Settle Civil Case with SEC

Fraud Allegations Were Filed in 2019
Celadon Group headquarters in Indianapolis
Celadon Group's headquarters was based in Indianapolis. The carrier declared bankruptcy in December 2019. (John Sommers II for Transport Topics)

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Two former top executives for now-defunct Celadon Group Inc. have agreed to an undisclosed court settlement with the Securities and Exchange Commission in connection with civil fraud allegations dating to 2019.

Terms of the settlement, which remain private, come about six months after the two former executives’ criminal fraud case was dismissed in August at the request of federal prosecutors. The dismissal came after a federal judge challenged as inaccurate statements made by an FBI agent working on the case.

The related SEC civil case was stayed until August, awaiting resolution of the criminal court case.

But on Jan. 30, the civil case also ended when Tim Baker, a U.S. magistrate judge for the Southern District of Indiana, wrote in an order, “Parties appeared in person and by counsel for a settlement conference. Settlement discussions were held, and this case is settled. The parties shall file a proposed agreed judgment within 60 days.”

Former Celadon president Meek


Two attorneys who represented the men did not return messages seeking comment.

The former executives, President William Eric Meek and Chief Financial Officer Bobby Lee Peavler, originally were charged with:

  • One count each of conspiracy to commit wire fraud, bank fraud and securities fraud.
  • Five counts of wire fraud.
  • Two counts of securities fraud.
  • One count of conspiracy to make false statements to a public company’s accountants and to falsify books, records and accounts of a public company.
  • One count of making false statements to a public company’s accountants.

But with the criminal charges dropped, the case then turned to the original 2019 civil complaint by SEC against Meek and Peavler for their role in an alleged complex securities and accounting scheme.

The complaint accused the executives of attempting to conceal losses in 2016 and 2017 by engaging in a scheme to buy and sell trucks at inflated prices — in some cases double or triple their fair market value.

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The complaint also alleged that as a result of the transactions with third-party dealers, Celadon materially overstated its pre-tax income, net income and earnings per share in its annual report for the period ending June 30, 2016, and in its subsequent public filings through the period ending Dec. 31, 2016.

Also, the complaint alleged that Meek and Peavler lied to Celadon’s auditor by claiming that the pricing in the transactions was “determined and evaluated independently” and by concealing their roles in negotiating and approving the transactions. Meek resigned from Celadon in 2017 and Peavler resigned in 2018, according to the complaint.

SEC originally was seeking permanent injunctions, monetary penalties and officer-and-director bars against the two executives.

Celadon Group on Dec. 10, 2019, appeared in a federal bankruptcy court in Wilmington, Del., the day after it announced plans to file for Chapter 11 bankruptcy and wind down its operations under the weight of huge debt obligations and a weakening trucking market.

But the two executives never had to stand trial when questions about the government’s case against the executives began after an August 2019, six-hour “proffer” interview among Peavler, his attorneys, FBI agents and U.S. Justice Department prosecutors. The proffer interview was intended to allow Peavler to tell his side of the story to prosecutors.

But the government’s case began to have problems after a written report from the proffer interview filed by one of the agents on the case was shortly viewed as suspicious by Peavler and his attorneys.

Victoria Madtson


In testimony and documents, Victoria Madtson said that Peavler “affirmed” his guilt in a statement during the interview.

However, the interview was not recorded or transcribed, a factor that ultimately worked against the agent’s claims.

One of Peavler’s attorneys who took notes at the meeting expressed “deep concerns” that Madtson’s statements were not accurate. In response to the defense attorneys’ accuracy questions about Madtson’s conclusions, federal Judge Jane Magnus-Stinson, of the U.S. District Court for the Southern District of Indiana, held two evidentiary hearings in February.

“Special Agent Madtson has undergone significant training as an FBI agent and is experienced in interviewing witnesses and suspects and preparing [FBI interview] FD-302 reports, specifically in cases involving white collar and financial crimes,” Magnus-Stinson wrote in a July 27 court order dismissing the case. “Despite her background and experience, however, she proved to be a questionable witness in this case for several reasons.”

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