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Morristown, Johnson City, Rogersville gas stations accused of price gouging will pay fines

April 16th, 2009 12:00 am by Staff Report

 Rogersville, Johnson City and Morristown business are among those accused to gas price gouging that have settled with the state and are paying fines.

 Attorney General Bob Cooper filed settled with settlements today with 16 companies and individuals who own 27 gas stations in Middle and East Tennessee over allegations of price gouging in the wake of Hurricane Ike.  Once signed by a judge, the settlements will result in $73,447 in potential restitution for consumers.  Collectively, the settlements amount to the largest enforcement sweep under the State’s price gouging statutes in the State’s history.  The Attorney General also filed suit against Knoxville-area retailer, Weigel Stores, Inc., for alleged unlawful price increases under the Tennessee Price Gouging Act of 2002 and the Tennessee Consumer Protection Act at seven gas stations. 

“In these trying economic times, consumers need their hard-earned dollars to stretch as far as possible.  I want to make sure that consumers are treated fairly – especially at the pump,” said Bob Cooper.  “Tennessee laws make a distinction between profits and profiteering. Under the Tennessee Consumer Protection Act, it is unlawful to unreasonably raise the price of an essential consumer good in response to a natural disaster, crime, or act of terrorism regardless of whether those events occurred in Tennessee or somewhere else.” 

On Sept. 13, 2008, Hurricane Ike made landfall in Texas, prompting several states to declare states of emergency. In the days following the storm, Knoxville and parts of East Tennessee had some of the highest gasoline prices in the country.

Even before Hurricane Ike made landfall, thousands of consumers reported suspected price gouging. Overall, the State registered more than 4,000 calls alleging excessive pricing. 

The Attorney General’s Office and the Department of Commerce and Insurance analyzed all of the information received from consumers.  The Attorney General’s Office reviewed the complaints, company costs, and pricing data and followed up by demanding additional information from more than 100 stations. After reviewing all of the information, the Attorney General settled with 16 companies and individuals, involving 27 retail stations in Tennessee.  All of the settling defendants cooperated with the State’s investigation.

“The assistance of the Department of Commerce and Insurance – especially the Consumer Affairs division – and the Department of Agriculture were instrumental in aiding this investigation and assisting consumers,” Cooper said. “We also appreciate the cooperation of the businesses that elected to settle these claims and reimburse their customers.”

“Protecting the interests of consumers and business owners alike to promote fairness,” said Commerce and Insurance Commissioner Leslie A. Newman, “is at the heart of what our department does. We were happy to support the effort to crack down on price gouging.”

 All  the defendants who settled deny any wrongdoing and assert they settled to avoid the time and expense associated with litigation.

The defendants who settled collectively advertised and sold regular unleaded gasoline at prices ranging from $4.69 to $5.98 per gallon.

Under the settlements, all of the gas stations will make restitution directly to consumers who submit a valid claim and will be paying civil penalties and costs to the State.  Collectively, these civil penalties total $40,000.  The total amount of restitution available to consumers is over $73,447. In pursuing the settlements, the Attorney General’s goal was to obtain as much restitution as possible for consumers who purchased from these gas stations. 

The companies and gas stations who settled with the Attorney General are: Rocky Top Markets, for eight stations in East Tennessee; Pilot Corp. and Pilot Travel Centers, for three  stations in Knoxville and one in Powell; Git ‘n Go, Inc., for two stations in Clinton; Chally Wally (Winchester); Shady Valley Country Store (Shady Valley); Caryville Amoco BP (Caryville); Stop ‘n Go Market (Morristown); Burnett’s Fuel Center (Allardt); Lovell Shell (Knoxville); Adams’ Lakeside Market (Estill Springs); Big D’s Shell (Clinton); Seven Star Stop (Johnson City); Fun Foods (Harriman); Rock Hill Grocery (Rogersville); Lacy’s Market (Mt. Juliet) and Speedy Market (Winchester).

 

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