Ruling doesn't go Conway's way

Jessica M. Karmasek May 26, 2011, 1:24pm


FRANKFORT, Ky. (Legal Newsline) - Kentucky Attorney General Jack Conway said he was disappointed in a ruling Wednesday denying his office's request for an injunction against Marathon Oil.

The injunction would have required Marathon to keep its prices at or below what it charged before a declared state of emergency, Conway says.

"I pursued this case to protect the best interests of consumers across the Commonwealth, who are hurting right now. Today's ruling is limited to this particular injunction, and the judge was clear that it does not affect the ongoing and underlying price-gouging case against Marathon," Conway said in a statement Wednesday.

"I believe Marathon has engaged in price gouging, and we plan to aggressively pursue that case."

According to the Lexington Herald-Leader, Franklin Circuit Court Judge Thomas Wingate ruled Wednesday that Conway did not prove that Marathon tried to gouge customers after Gov. Steve Beshear signed an emergency order April 26.

The governor had signed the order, which says companies are not allowed to raise their prices over their costs, after massive flooding hit the western region of the state.

The Attorney General's Office said consumers almost immediately started calling in, upset about the higher gas prices. In some areas, just a day after the storms, gas jumped more than 30 cents a gallon.

Despite the judge's ruling, Conway said he is pleased gas prices have gone down since his office sought the injunction, providing residents with some relief.

However, he remains concerned about Marathon's dominance of the wholesale gasoline market in the state, saying it allows a distortion of gas prices.

"In certain areas of the Commonwealth, it actually has a 100 percent monopoly on wholesale supply," Conway said.

"In the long term, we must address this problem, and I am turning over evidence we have developed to the U.S. Department of Justice's recently formed gas task force that is charged with investigating illegal activity in the oil and gas markets."

Also on Wednesday, Beshear extended the state of emergency an additional 30 days. His original order was set to expire Thursday, the Herald-Leader reported.

The governor said the Attorney General's Office now will have more time to look into other price-gouging allegations.

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

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