BURNED THROUGH FUNDING – Last September, Trueline Infrastructure Solutions, backed by Grain Management, unveiled the merger of three leading telecom companies under a unified vision and bold new identity. However, CEO David Grain’s vision proved short-sighted, as the company collapsed just six months later, shattering the prospects of the three privately owned businesses that had hoped to build on their years of hard work. In addition, Trueline hired some of the nation’s top talent who are now unemployed. A class-action lawsuit filed on Monday is seeking at least two months of salary for the laid-off workers.
Trueline Infrastructure Solutions, a broadband construction firm backed by private equity giant Grain Management, abruptly shut down last week, laying off nearly all its 500 employees on Friday. The sudden closure shocked employees, prompting a class-action lawsuit against Trueline for allegedly violating federal labor laws.
In its reporting, Fierce Network stated that Trueline emailed its staff on Friday to inform them that the company would begin winding down operations immediately due to “unprecedented changes in the market” and “increasing competitive pressures.”
A small group of employees will remain for a few weeks to handle the shutdown.
The lawsuit, filed by Dusty James Higgins on March 3, 2025, on behalf of himself and approximately 500 other affected workers, claims that Trueline terminated employees without the required 60-day advance written notice following a “plant closing” on or around February 28, 2025. Higgins, who worked at the company’s Bloomington, Indiana facility, alleges that the sudden layoffs left employees without pay, benefits, and other compensation for the mandatory 60-day period stipulated under the WARN Act.
The WARN Act requires employers with 100 or more employees to provide written notice at least 60 days before company closings or mass layoffs affecting 50 or more workers. According to the complaint, Trueline failed to notify employees and did not provide wages, 401(k) contributions, or health insurance benefits for the two months following their termination.
The lawsuit seeks compensation equal to 60 days of back pay and benefits for the affected employees, along with interest, attorneys’ fees, and other related costs. It also requests class-action status.
Leadership exodus and financial woes
The shutdown followed a series of ominous signs. Trueline’s CEO, Rob Hughart, resigned just days before the layoffs, and CFO Karla Lunan stepped down in January. Darren Muljo, Trueline’s former Environment, Health, and Safety Manager, criticized Grain’s handling of the situation, questioning how the firm, which manages $9 billion in assets, could allow such a collapse.
“There are 300 families left in limbo,” Muljo informed Fierce Network, highlighting employees’ uncertainty, including at least three who had surgeries scheduled and are now unsure if they still have health insurance.
Contracts terminated and projects abandoned
Trueline’s troubles became more evident when Aspire/Highline, a significant service provider client in Michigan, recently terminated its contract. A few weeks prior, Trueline had instructed employees to pause operations in certain states, attributing the decision to weather conditions. A former program manager, Rob Bridges, said he suspected financial trouble months ago when he managed warehouses full of materials and staff but no active projects.
Muljo described unfinished construction sites in Florida and other states, with open trenches, exposed conduits, and roads left partially restored. “It’s a shame that Grain purchased fully functioning family-owned businesses only to now shut everything down,” he added.
Grain management remains silent
Grain Management, a well-known telecom investor with several service providers, declined to comment on the shutdown. In 2024, Grain had formed Trueline by merging Atlantic Engineering Group, Fiber Optic Services, and Young’s Communications, with plans to compete aggressively in the fiber broadband infrastructure market.
Last September, Trueline announced the tripartite team that closed its doors six months later. The sudden collapse of Trueline has raised questions about Grain’s due diligence and management practices, leaving employees and industry analysts seeking answers. As the employees’ legal battle unfolds, additional lawsuits are expected to be filed.
Grain’s investment strategy, according to its website, is: “We target hard assets and companies with inflation-protected revenue streams and sustainable cash flows that are uncorrelated to market cycles.” It doesn’t appear that Truline came close to meeting that design.
Waiting for BEAD funding could have torpedoed Trueline
Trueline, heavily weighted in fiber to the home, in principle, could have benefited significantly from the $42.5 BEAD funding that had been delayed during the Biden administration.
Yesterday, Congressman Richard Hudson (NC-09), Chairman of the Subcommittee on Communications and Technology, criticized the Biden Administration’s handling of rural broadband funding during a hearing titled “Fixing Biden’s Broadband Blunder”.
Hudson highlighted that despite the $42.5 billion allocated through the Broadband Equity Access and Deployment (BEAD) program under the 2021 Infrastructure Investment and Jobs Act, no homes have been connected with these funds. He blamed delays on slow FCC map development and the “burdensome” regulations imposed by the Biden Administration, including labor rules and climate requirements.
To accelerate broadband deployment, Hudson introduced the SPEED for BEAD Act. The proposed bill aims to eliminate these regulations, clarify that broadband rate regulations are prohibited, and ensure that funding is used efficiently. He also stressed the need for streamlined permitting processes to avoid further delays.
Hudson welcomed Commerce Secretary Howard Lutnick’s announcement of a review to reduce red tape in the BEAD program, calling it a step in the right direction. He urged bipartisan cooperation to overcome obstacles and close the digital divide for rural Americans.
