Invalidating the Defense’s Use of Biased Industry Studies – Or “Is this Deliverance and do I hear banjos?”

In Series 9 of Busting’ Brokers, we looked at Establishing a Solid Defense. Now we’re going to dig a little deeper into these specific reports that trucking companies may try to use to deny liability in your client’s injury case. The first we’re going to look at is Wells Fargo and specifically the studies by Anthony P. Gallo. I think by the end of our review of these reports, you’ll see just how inbred the trucking companies defense team and insurance companies are with supposed “industry experts” who write “unbiased and expert” reports on trucking safety.



Wells Fargo Studies The studies by Anthony P. Gallo at Wells Fargo Securities present similar opportunity for attack on cross examination.  To begin with, the reports themselves note that they may have a conflict of interest.  In fact, the reports have this disclaimer at the bottom of their first page (with emphasis added):

Wells Fargo Securities, LLC does and seeks to do business with companies covered in its research reports.  As a result, investors should be aware that the firm may have a conflict of interest that could affect the objectivity of the report and investors should consider this report as only a single factor in making their investment decisions.

At the end of the reports, Wells Fargo discloses a number of companies in which Wells Fargo Securities, LLC and/or its affiliates own(ed) stock, manage(d), provide(d) services to, or have/had some other significant financial interest or relationship.  Among the companies cited are some of the biggest names in the Transportation and Brokerage industries, including Arkansas Best Corp., C.H. Robinson Worldwide, Inc., Heartland Express, Inc., Hub Group, Inc., J.B. Hunt Transport Services, Inc., Landstar System, Inc., Old Dominion Freight Line, Inc., Swift Transportation Co., and Werner Enterprises, Inc.[1]

Not only does this demonstrate a clear bias, but the very essence of the “study” themselves is subject to impeachment.  Indeed, the studies were conducted by an analyst for a securities firm, not a researcher in transportation industry issues like the UMTRI study.  In fact, Mr. Gallo’s own statement before the U.S. House Committee on Small Business on July 11, 2012, calls into question his very qualifications for conducting the “studies” put forth by Wells Fargo.  In his Oral Statement to the Committee, Mr. Gallo began by stating as follows (with emphasis added): “I am not an expert on truck safety, small business or statistics….My research is largely conducted in the context of providing investment ideas and strategies to institutional investors.  I publish fundamental market research on the trucking, railroad and parcel segments within the broader freight transportation industry.”[2]

Further, as indicated in the ATRI study, the methodology used in the Wells Fargo analysis itself uses an incorrect statistical analysis and should not be relied upon.



In our next series, we are going to look at the Iyoob Reports – who is this guy, anyway?

[1] Regulatory Roulette:  Assessing CSA, March 28, 2011 at p. 6; CSA:  Good Intentions, Unclear Outcomes, November 4, 2011 at p. 13; CSA:  Another Look With Similar Conclusions, July 2, 2012 at p.19.

[2] Transcript of Oral Statement on Wednesday July 11, 2012, before the Committee on Small Business, available at