MONTGOMERY, Ala. (Legal Newsline) - Alabama Attorney General Luther Strange announced Friday a $500,000 settlement with two propane providers that allegedly violated the Alabama Deceptive Trade Practices Act.
ThompsonGas-Smokies LLC and Suburban Gas Propane Partners LLC provide propane to customers throughout Alabama and share a regional headquarters in Columbiana. Strange sued Thompson and Suburban in May 2012, alleging the companies billed about 2,000 of their customers a minimum usage or non-usage fee that ranged from $192.80 to $706.80.
Many of the customers who were charged the fees came to Thompson and Suburban after their propane providers were acquired by the companies. The new customers allegedly had varying contracts that did not provide for the charging of minimum usage or non-usage fees.
"Alabama law requires that our consumers be able to rely upon contracts and that they be provided clear notice of any changes that will incur new fees," Strange said. "We will not allow businesses to impose fees on consumers who were operating under a contract that did not provide for such fees.
"I am pleased that consumers in this case will receive refunds and that abusive practices will no longer be conducted."
Under the terms of a consent decree, Thompson and Suburban must pay restitution to consumers and put measures in place to prevent the allegations from recurring. Thompson and Suburban will send a letter to affected consumers notifying them of the refund amount due, as well as information on how to contest the amount. The companies agreed to clear the balance on any of the incorrectly charged fees that were not paid and to pay consumers for gas that was in removed tanks.
Future fee changes made by Thompson and Suburban must be clearly set out in a prominent notice sent to customers.