Minn. AG reaches settlement with national propane company

Bryan Cohen Aug. 23, 2011, 1:44pm


SAINT PAUL, Minn. (Legal Newsline) - Minnesota Attorney General Lori Swanson announced a $450,000 settlement on Tuesday with a large national propane energy company.

Ferrellgas L.P. allegedly failed to disclose specific per-gallon prices to consumers who called to fill their tanks. The lawsuit further alleged that despite telling its customers that it would charge "our current market price" or "competitive propane prices," the company sometimes charged rates that were significantly higher than those of its competitors.

Ferrellgas also allegedly charged undisclosed and poorly disclosed fees, including "low usage" and "no usage" fees of up to $199 for consumers who, in the company's judgment, did not use enough propane.

The settlement requires Ferrellgas to disclose the price it will charge consumers at the time of a consumer's order. The settlement also requires conspicuous and clear fee disclosures. In addition, Ferrellgas must directly refund all no-use and low-use fee charges to Minnesotans.

"For many people, propane is a costly necessity to heat their homes," Swanson said. "Propane pricing should be transparent so that consumers can make informed choices about their purchases."

The settlement requires the company to pay $450,000 to the state. Swanson's office will create a settlement fund, from which it will compensate Ferrellgas customers who make a valid claim that they paid undisclosed fees or charges.

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