Gas station chain hit with $30M verdict in Texas

Jessica M. Karmasek Nov. 10, 2010, 11:58am


AUSTIN, Texas (Legal Newsline) - A Harrison County, Texas, jury on Tuesday handed down a $30 million verdict against Petroleum Wholesale LP for allegedly cheating consumers at its fuel pumps.

The ruling stems from Operation Spotlight, a 2008 investigation led by the state Department of Agriculture. The department alleged Petroleum Wholesale was manipulating fuel pumps and shortchanging customers at 86 of its SunMart service stations by dispensing less gasoline than consumers were paying for.

Texas Attorney General Greg Abbott had charged the company in July 2008 with defrauding customers.

Agriculture Commissioner Todd Staples said in a statement following the ruling, "This verdict sends a strong message that Texans will not tolerate being cheated out of their hard-earned money. In Texas, we demand that we get what we pay for. The Texans who served on this jury have made a decision that will further strengthen consumer confidence and send a clear signal that Texans will not tolerate deceptive sales practices by anyone.

"In an industry that overall has a 94 percent rate of compliance with fuel measurement standards, the Texas Department of Agriculture will continue to ensure consumers are protected at all levels from those few unscrupulous businesses that choose to ignore the law. I am pleased with the jury's findings and encouraged to know our message is loud and clear: One Texan cheated is one too many."

Under Texas law, the agriculture commissioner is charged with regulating weights and measures, including gasoline pumps. Later, the agency referred its findings to the Texas Attorney General's Office, which charged Petroleum Wholesale with violating the Texas Deceptive Trade Practices Act.

As part of its Operation Spotlight investigation, the agriculture department's inspectors tested 1,701 SunMart fuel pumps. Testing allegedly revealed that 985 pumps were calibrated in favor of Petroleum Wholesale, dispensing less than a full gallon of fuel to consumers for each gallon purchased.

According to The Courier, a Montgomery County newspaper, the jury found Petroleum Wholesale liable for $18.765 million in restitution, $8.49 million in civil penalties and more than $2.7 million in fees to the state.

The state also is seeking a permanent injunction prohibiting the company from calibrating its own pumps.

Officials with Petroleum Wholesale continue to deny the allegations and plan to appeal the judgment, according to a prepared statement from public relations company Red Media.

From Legal Newsline: Reach Jessica Karmasek by e-mail at

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