Jimmy Haslam, Pilot Flying J. and Warren Buffett, Chairman and CEO of Berkshire Hathaway.
Lacey O'Toole | CNBC
A billion-dollar trial to determine whether Berkshire Hathaway used an accounting system that significantly shortchanged the Haslam family in buying the family's remaining minority stake in Pilot Travel Centers has been overturned in Delaware Chancery Court.
The trial was scheduled to begin on Monday and conclude on Tuesday.
It was not immediately clear why the investigation was canceled and whether Berkshire Hathaway — led by CEO Warren Buffett — or the Haslams settled their dispute involving Pilot Travel Centers, America's largest truck-stop chain.
It's also unclear whether the cancellation will affect Berkshire's claims that Jimmy Haslam, a family member who owns the Cleveland Browns football team, made “illegal side payments to several PTC senior executives” to boost the value of the family's remaining stock. Berkshire will be forced to buy.
Last month, it was reported that federal prosecutors have New York They were investigating the allegations against Jimmy Haslam.
“This is to confirm that the trial scheduled for January 8 and 9, 2024 in this matter is canceled and removed from the court's calendar,” the notice in the Chancery Court docket reads.
CNBC has requested comment from spokespeople for Berkshire and the Haslam family.
The cancellation late Saturday came two days after the judge held a brief conference with attorneys for Berkshire Hathaway and the Haslams to discuss the logistics of the trial.
Buffett's designated successor, Greg Abel, was expected to testify at the hearing, whose outcome led Berkshire to pay $1.2 billion more for the Haslams' stock than Berkshire paid.
Berkshire spent $11 billion in separate purchases in 2017 to buy the majority stake owned by the Haslams last January, which owns 80% of PTC.
Each year thereafter the Haslams had a “put option” to force Berkshire to buy their remaining 20% state.
Last year, the family sued Berkshire, alleging that it used so-called pushdown accounting that had the effect of reducing the stated value of the PTC, leaving the Haslams short of what they were legally owed.
The Haslams claimed that the form of accounting was not approved by them.
Berkshire argued that using pushdown accounting was not a change in accounting policy, which was prevented by its purchase agreement with the Haslams.