A Dallas County jury on Thursday awarded almost $9.5 million to a trucking business that claimed it was forced aside when a private equity firm acquired its principal client, the El Rancho Supermercado grocery chain.
The verdict came on the second day of deliberations in Skyward Transportation’s civil suit against Mexico Foods, doing business as El Rancho, and Conecta Logistics, El Rancho’s in-house transportation entity.
The suit, tried over 10 days before state District Judge Aiesha Redmond of Dallas, alleged that Skyward’s decadelong business relationship with El Rancho had been mutually beneficial, helping both the trucking company and the grocery chain grow geometrically — until El Rancho was acquired in 2023 by Heritage Grocers Group, an arm of the huge private equity firm Apollo Global Management.
Heritage, which operates ethnic grocery companies across the country, wanted to consolidate food delivery services across its properties, the suit said, and, to that end, began “fabricating grounds for Skyward’s default and challenging agreed upon payment terms in a misguided effort to ‘cut costs.’”
“They put profits before people. They can be pretty ruthless,” Skyward’s lead attorney, Michael K. Hurst of Lynn Pinker Hurst & Schwegmann, told the jury in closing arguments Wednesday. Hurst argued that his client was entitled to more than $27 million in damages.
Skyward’s owner, Curtis Lawrence, the first witness called in the trial, said losing his contracts with Mexico Foods “destroyed” his company, which he started 15 years ago with one truck when he was 19. Lawrence said the Mexico Foods contracts accounted for 92 percent of his company’s business.
“It was traumatic. … You keep asking yourself why,” he said.
Hurst said of the jury’s verdict, “This is an important reminder of why our jury system is such an important part the fabric of justice. Most people and companies the size of Skyward would not dare take on corporate giants like Apollo — but most people aren’t Curtis Lawrence. I am so proud of Curtis’ courage and determination, and of our incomparable trial team that tirelessly fought to bring home this victory for Curtis and Skyward.”
Lawyers for Mexico Foods and Conecta said Skyward’s contracts were terminated not to save money but because of substandard performance. Three El Rancho store managers testified that Skyward’s deliveries were sometimes late or incomplete or included products that were damaged or not transported at proper temperatures — resulting in shortages on their shelves.
El Rancho stores “have an obligation to their patrons. People come to the stores to buy food, groceries, to put on the table and feed their families,” William Toles of Munsch Hardt, a member of the defense team, said in his closing argument.
Referring to testimony from plaintiffs’ witnesses who described a strong, trusting relationship between Skyward and El Rancho before the grocery chain was sold, Toles said: “Relationships are good. Performance is better.”
A spokesperson for Mexico Foods, asked for comment on the jury’s verdict, said: “Our commitment to ensuring excellence across every aspect of our supply chain remains unchanged. We are focused on maintaining the highest standards and working with vendor partners who are aligned with our safety and service expectations.”
In addition to Hurst, Skyward is represented in the suit by Jared Eisenberg, Andy Kim and Jamie Drillette of Lynn Pinker; and Anthony M. Farmer and D. Robert Jones of the Farmer Law Group of Dallas.
In addition to Toles, the Mexico Foods entities are represented by Greg C. Noschese, Jay D. Evans, and Emily C. Means of Munsch Hardt.
The case is DC-23-15759