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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Love it!
Cumberland Farms did the same thing in Windsor County, bought out an old Sunoco gas station, closed it and restricted the deed so gasoline couldn’t be sold from there in the future. How the Attorney General can allow any company to do this sort of thing is beyond me!
Was wondering if anyone was ever going to do something about this just recently when buying gas in Middlebury where gas is routinely 10-20 cents cheaper. So very glad that action is finally being taken!!!!
Its about time! Hope this puts the whammy on these money hungry rip off artists.
It is absolutely quite obvious that we are getting ripped here in Vt and in Chittenden County for that matter!
Sooo interesting…this must have been in the wind for a bit….in the last few weeks – for the first time in memory Chit. gas prices are about the lowest in the state – after spending years as the highest…coincidence?
Acourse Sanders and Shumlin and Att General Sorrell didn’t do anything..they are DEMOCRATS..where do you think they get their donations from..from those top gas cos like R.L. Vallee, S.B. Collins and the others ..they don’t want competition from Costco and Walmart..because the 4 company’s are greedy..never mind helping Vermonters just care about filling their own pockets..
Every industry in Vermont does this. Rent costs are criminally high, education costs are criminally high, utility costs are up there too. Vermont has become the biggest rip off state in the entire country. My childhood friend has a 3 bedroom apartment in Manhattan for the same price as a 3 bedroom in Burlington’s North End. The rich get richer and the poor get sucked into the heroin vacuum.
Champlain Farms’ business model: rip people off at the gas pumps, and sell overpriced junk food, soda, beer, and cigarettes to poor people in dirty, disorganized stores. What a bunch of charmers, and a local company too!
When do I get a piece of this class action and and all the other Vermonters that have paid these over inflated prices. The wheels of justice turn slower than R.L. Vallee, Inc. can turn up the prices up for all these years.
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
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.
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….
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.
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!
Bone of contusion?
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?
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
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.
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.
This makes for great campaign fodder for Bernie and an attempt by our AG to go out on a high note while discrediting families who work hard every day at their place of business. Truth be told, there are consumers who like the experience of shopping at these fine stores. They are full service operations that help us gain access to quality products, with quality service so we can be on our way. I’m ok with paying a little more for that level of service, even if its at the pump. Many of us pay more for great food and great service at restaurants, resorts, sports venues, health & fitness facilities etc. If everyone wants to dream up visions of 3 of the most successful Vermont based business owners who employ hundreds of Vermonters all sitting around a poker table in a smoke filled room cutting deals like mafia bosses are loony. Have fun with that investigation while wasting more tax dollars and turning everyone’s attention away from the bigger picture- our state’s abysmal democratic leadership.
I only wish that Lamoille County had been included in this action as we are victim of the same bandits as the counties mentioned. Just today I bought some gas in Lamoille County for $2.84/gal and drove into Chittenden County where I filled the tank on my motor home at $2.62/gal at the Essex GO-GO. The Highwaymen Cabal operates all over north central Vermont as well and we should all be parties to this lawsuit. How about some recognition for us Bill Sorrell?
To think that these three stalwart Republicans are not meeting for drinks and golf at the country club and talking about their business, and specifically pricing, is a fantasy. Of course they do. You are not going to find a smoking-gun paper trail, they are too smart for that. But you see the results in the pricing.
As to the “deed restrictions,” I would note that they are likely voidable as being against public policy. It has the flavor of selling a house and putting a restriction in there that no black, or gay person, or single mother, can ever live there. To say that a gasoline station can never be used to sell gasoline is a classic abuse of the concept of deed restrictions. My guess is that nobody dares buy the place and then take it to Court as they would not have the deep pockets needed to slug it out with the cartels’ aggressive lawyers. This is “legal abuse” of the rankest sort.
“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.”
Government red tape is preventing the free market from fixing the problem on its own. How does someone “misuse” a law that applies to someone else anyway? If that’s possible, then these are bad laws. The solution isn’t more of them.
Part of the problem concerns vertical integration. The same companies control both wholesale and retail, so they can fix prices, both within their own stations, and in the stations they do not own but supply. Vertical integration is not permitted in other states, NH for example. We are being ripped off and it is not as easy as saying just shop somewhere else – how far would you have to go? A new law is required to keep the market fair. Profits OK, profiteering not OK.
This is not a political matter although it’s easy to say that.
It’s simple…the wholesaler is also the retailer. That means they control the price from both ends. That’s how they can price fix. Any independent stations gets gas from the wholesaler who also owns retail locations. He can not supply anyone who undercuts his prices.
This is called a monopoly and why when two major player try to join it must be approved as it eliminates competition.
Take all the politics out of it and look at it as straight business. There’s a reason why wholesalers should not be allowed to be retailers too. They have a huge advantage of an independent retailer.
They’re doing it again. They used a short stoppage in production from Hurricane Harvey to jack prices WAY up and the price has not dropped since. WHY ARE THEY NOT BEING STOPPED AGAIN !!! Once again I have to limit my driving because I cannot afford these prices. Damn! Somebody do something!