Updated at 4:50 p.m. on 6/22/15 with a quote from Joe Choquette.
For years, public officials have raised questions about high gas prices in northwestern Vermont. Sen. Bernie Sanders (I-Vt.), state Attorney General Bill Sorrell and plenty of others have organized hearings, held press conferences and even requested a federal investigation into the matter. Nothing much has come of their efforts.
On Monday, the law firms Bailey & Glasser and The Burlington Law Practice filed a class action lawsuit alleging that four local companies — R.L. Vallee, owned by Skip Vallee, which runs the Maplefields chain; S.B. Collins; Champlain Farms/Wesco; and Champlain Oil Company — have made exorbitant profits by illegally conspiring to keep gas prices high.
In a complaint filed Monday afternoon in Chittenden Superior Court, the plaintiffs describe the defendants’ wholesale and retail profits as “extraordinarily out of line.” At times, according to the filing, those profits have been twice the national average and the second highest of 450 gas markets in the United States.
The suit, which alleges a violation of the Vermont Consumer Protection Act, is being brought on behalf of people who purchased gas at stations owned or supplied by those four companies in Chittenden, Franklin and Grand Isle counties from 2005 until the present day. The plaintiffs claim that the defendants control more than 60 percent of suppliers and retail stations in those counties, and they suggest that the companies “may have pilfered over $100 million” from customers during this time period.
The filing alleges that the four companies’ gas prices “have increased, decreased or held steady in nearly identical fashion” and that they’ve gone up even when prices were declining.
The defendants are also accused of suppressing competition by buying gas stations, shutting them down and reselling the properties with deed restrictions that prevent them from selling fuel. Referring to efforts led by Vallee to quash new gas stations at Walmart in St. Albans and Costco in Colchester, the complaint states, “The defendants have cynically misused, sometimes in concert, Vermont environmental laws to obstruct the entry of low-cost gasoline providers and to extract unreasonable covenants that prevent or limit competition.”
The lawsuit alleges that the companies’ officials have consistently lied while testifying in front of public officials. “At each of the hearings the defendants’ answers cycled between pretextual, nonresponsive, incomplete and false. A representative of defendant R.L. Vallee, Inc. seemingly attributed the higher prices, in part, to their use of fresh flowers in their bathrooms—a contention mocked by a Vermont state representative at a subsequent hearing.”
The suit alleges that the four companies have temporarily lowered prices ahead of such hearings “to deceive lawmakers and citizens, and to evade detection of their broader price-fixing scheme.”
The suit was brought by Bailey & Glasser lawyers from Washington, D.C., Boston and Chicago, and Joshua Simonds of the Burlington Law Practice.
Reached by email, Vallee, who had not been aware of the lawsuit, told Seven Days he had no comment on the “alleged litigation.” Presidents at the other three companies could not immediately be reached.
Joe Choquette, a lobbyist for the Vermont Petroleum Association, said he couldn’t speak on behalf of an individual company, but in an emailed statement, he suggested that the lawsuit was unfounded.
“There is no new information in the materials that have been filed by the two law firms,” he wrote. “With the same information, both the Federal Trade Commission and the Vermont Attorney General’s Office have declined to take any action in the past. We believe that motor fuel marketing in Vermont is highly competitive, and we have appeared many times before legislative bodies and in the media to explain the marketing and pricing of gasoline. This is a transparent industry that posts its prices on 12-foot signs at the street level for all to see.”
Clarification: This story was updated at 5:30 p.m. on 6/22/2015 to make it clear that it’s the plaintiffs who claim that the defendants control more than 60 percent of the local gas market.
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Ms. Boutin: Highly unlikely, if not impossible, to accuse Democrats of getting campaign contributions from these folks — e.g. Skip Vallee has long been a major Republican party fundraisers, and was rewarded by George W. Bush with the ambassadorship to SLovakia. Westco was founded by Walter Simendinger and is now owned by his son. The elder Simendinger served as Chittenden County Republican chair and was a vocal and financial political opponent when Bernie Sanders was mayor . A quick google search shows the entire Simendinger clan were donors to Jack Kemp’s presidential campaign back in 2008. One donation showed up for Bruce Jolley of SB Collins, and that was $2000 to the Republican party in the 1990s. C. Douglas Cairns, founder of Champlain Oil, was Nixon’s campaign director in Vermont.
I used to run the Convenience Store Division throughout the United States.for a company. I can tell you that these owners do put more money back into running clean safe operations than in many parts of the country. What I really want to know is how much of these profits go back into operations. Some of these owners were much easier to do business with than many others in the industry. Let’s see the proof of illegal price fixing and collaboration. Everything costs too much in Chittenden County.
Good to see.
Senators Starr, Zuckerman and I offered an amendment calling for a similar investigation by the Attorney General only to have it ruled non germane. At last we will find out if these allegations are true. Even if over charging amounts to only a dime per gallon, Chittenden, Franklin and Grand Isle consumers could be out of pocket many millions of dollars annually.
Senator Michael Sirotkin, Chittenden County
Someone posted until we become a socialist, communist State things will not get better. Ask those Countries who have this how happy life isn’t for them. We live in a Country, or we did, where the people decide what happens by their vote or by getting involved with like-minded people to make changes if we do not like it. Lets see, the people standing together for what is right or a socialist government telling the people what to like or how to think?
Bone of contusion?
The corruption in the United States has become so seamlessly integrated that we don’t even see it or question it anymore. In fact, many will even defend it as necessary or beneficial. The fact that Vallee et. al. can even file the lawsuits preventing Costco from selling gasoline on the basis of environmental objections is so laughable I am falling off my chair even as I type this sentence. How can they even maintain a straight face when making those arguments? How can the people of Chittenden County not refuse to buy gas from Mr. Vallee or his outlets until he finally gives up his objections and lets real competition exist here?
Oh, I forgot, we don’t really care that much to actually do anything about it. So guess what? We keep on getting screwed, because we let them get away with it.
Stop buying gas from him for a week and see how long it takes for him to change his mind.
Sooner or later, we won’t even question the corruption and collusion anymore, because those people who remember what life used to be like will have long since died. And after that, everything really is down the Memory Hole. Cheers!
Bullhockey, Mr. Hughes. These retailers are also the wholesale distributors for this area, which is the reason you don’t see a single independent gas station ever undercutting the chains in Chittenden County. The wholesalers control the market, and if an independent ever tries cutting the price, they won’t be getting any more deliveries. This is anything but a free market.
There’s no case against these companies because we live in a free market society and until we evolve into a socialistic or communist state free enterprise does not dictate pricing structures. They don’t do it in the healthcare field. Why doesn’t anyone complain when an Xray fee at the doctors office cost $200.00 more at one facility than others, or a steak at a supermarket costs more than other supermarkets? Its because politicians want points on their resume that claims they care about the everyday Vermont taxpayer. Simply put if I’m not satisfied with the price of gas at one particular gas station, then I “choose” another.. I sell products made from petroleum and when pricing goes up all of my competitors pricing follows suit. But when pricing decreases and my costs from the state government continue to skyrocket, then I need to use this opportunity to fund those increased costs with the extra margin made on that difference. Its economics people- get with the program….
This has been a bone of contusion of mine for a real long time. It is no secret these companies are here to make money. But screwing people for a much needed commodity especially when times have been tough for many the last 6 years. Run them up a flag pole. When gas went way down in January. The price difference between Houston Texas and Manchester New Hampshire was 20 cents a gallon. The price difference between Manchester N.H. and South Burlington was 25 cents per gallon. Wegot screwed so pay back time.
I feel to not want to ever go to champlain gas again I have been getting all of our gas for a very long time and this is what we get