Maine SC affirms restitution in AG's case

Jessica M. Karmasek Jul. 15, 2011, 10:29am


AUGUSTA, Maine (Legal Newsline) - The Maine Supreme Court sided last week with the state Attorney General's Office in an appeal by a fuel delivery business for its failure to fulfill its prepaid delivery contracts.

The fuel businesses are Price-Rite Fuel Inc., Veilleux Oil & Service Inc., Perron Fuel Inc. and Nicholas Curro III. Collectively, they are referred to as Price-Rite in Court documents.

Representing the State were former Attorney General Janet T. Mills, Assistant Attorney General Linda J. Conti and Assistant Attorney General Carolyn A. Silsby.

According to the Attorney General's Office, the fuel delivery business failed to fulfill its contracts during the winter months of 2007-2008.

Following hundreds of calls by Price-Rite customers, the office filed a five-count complaint against Price-Rite in January 2008 and filed an amended complaint a month later.

The York County Superior Court issued a detailed injunction that prohibited Curro and any business entity that he controls or in which he has majority ownership from selling any prepaid contracts for home heating oil, kerosene or liquefied petroleum gas for a period of five years.

The court's judgment also required Price-Rite to pay restitution of $393,735 to the Attorney General's Office on behalf of 313 consumers, and to pay a civil penalty of $250,000 after the restitution has been paid in full, with all but $25,000 of the penalty suspended if the restitution is paid within five years.

It also imposed a civil penalty on Curro for violations to Maine's Unfair Trade Practices Act, finding that the violations were intentional and that "(a)n officer of a corporation who intentionally and knowingly violates the UTPA is personally liable for damages and penalties arising from such a violation."

Price-Rite appealed to the state's high court. It contends that the court erred in denying its motion for judgment as a matter of law on the ground that the attorney general failed to comply with a 10-day notice requirement prior to filing its complaint.

Curro also contends that the court erred in imposing a civil penalty on him for intentionally selling prepaid oil contracts that did not comply with security requirements.

The Court, in its July 5 decision, affirmed the superior court's judgment. Justice Jon D. Levy authored the Court's opinion.

Levy said Price-Rite's argument fails to recognize that the affidavits filed by the attorney general in support of the motion for a temporary restraining order brought the case within an exception to the notice requirement.

"Had Price-Rite asserted an objection to the State's proceeding because it was not provided the 10-day notice in response to the initial complaint, the court may have, in the exercise of its discretion, ordered the dismissal of the complaint," he wrote for the Court.

"This defect was cured 20 days after the initial complaint was filed, however, when the attorney general filed the affidavits that established irreparable injury."

Levy added, "In the absence of a showing that Price-Rite was actually prejudiced by the filing of the affidavits 20 days after the filing of the initial complaint, there was no basis for the court to grant Price-Rite's motion for a judgment as a matter of law."

The Court, in the superior court's imposition of the penalty against Curro, said there was "ample evidence" supporting the lower court's findings.

"The former general manager of Veilleux Oil testified that Curro had decided that the prepaid contracts would be sold and that he had set their prices; this establishes that Curro intentionally sold the contracts," the Court wrote.

"A letter that Curro signed and sent to potential customers stating that the company was in compliance with the security requirements for prepaid contracts required by Maine law demonstrates that he knew the requirements of the statute."

The evidence established that Curro knew his companies were in financial distress and would be unable to fulfill their contractual promises, the Court said.

"The court's ultimate conclusion that the evidence established, by the fair preponderance standard, that Curro acted intentionally, was sound," it concluded.

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