GAITHERSBURG, MD ? Oil Express broke news yesterday that a federal jury in Kansas deciding the "hot fuels" case said all three defendants were not deceptive when they failed to disclose the temperature of fuel sold to retail customers.
"The Judge will now decide if it is unconscionable, but (it will be) very hard for her to say it is when (the) jury said it's not deceptive," a legal source attending the trial told the news source.
Had the jury had sided with the plaintiffs, some gas stations would be forced to install automatic temperature compensation (ATC) devices ? it is estimated this would cost $2,000 or more per unit. ATC devices would physically adjust the size of a gallon of fuel dispensed to the consumer based upon a calculation using the temperature of the fuel at that time.
The issue of ?hot gas? stems from an allegation that retailers are defrauding the consumer by selling fuel at a temperature greater than the 60 degrees F, at which a gallon of gasoline is measured. At this temperature, gasoline occupies 231 cubic inches. Studies indicate the average national temperature of fuel dispensed in this country is 64.7 degrees F. At this temperature, the same amount of gasoline would expand to occupy a slightly larger volume (every 15 degrees F results in a 1% change in volume). The plaintiffs allege that retailers have colluded for years to sell expanded gallons at non-adjusted prices. They allege this collusion has resulted in more than $2 billion in excess retailer profits.
Oil Express writes that many large gasoline retailers and major oil companies have been sued in the class action. In the Kansas case, all but three large convenience store chains (7-Eleven Inc., QuikTrip and Kum & Go) chose to settle.
Over the years NACS has been very active in educating officials about the nature of the retail fuels market to explain there is no basis for the allegations of collusion and that the installation of ATC devices would actually cost the consumer more than they could conceivably benefit. Read more about industry and NACS efforts in NACS Magazine.