Lawsuit against Speedway/Super America/Marathon!?

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Kentucky Attorney General Greg Stumbo announced groundbreaking
litigation filed today in Franklin Circuit Court against Marathon Oil
Corporation, Marathon Petroleum Company, LLC and Speedway SuperAmerica,
LLC, charging the corporations with profiteering during the time of
emergency following Hurricanes Katrina and Rita. The companies are
alleged to have overcharged Kentucky consumers more than $89 million in
grossly excessive motor fuel pricing.

WHERE IS MICHIGAN?! I e-mailed Michigan Attorney General Michael Cox.

Read the full story here

6 Comments

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  1. Why not regulate the oil industry similar to the electric company. The electric company is a needed comodity just like auto fuel and they seem to profit without all the wild swings in prices to consumers. I’ll bet none of the electric company’s employees work for less than minimum wage selling their product. Wish I could say the same for independent gasoline retailers. How often do you feel gouged by the electric company? There should be more control of the oil industry to prevent the unfair practices that affect us all.

  2. What I find most distrubing is even after Katrina 2, almost 2 years later not a single new refinery has even started to be built.

    Big Oil has no reason to put money towards improving refining infrastructure as demand increases and the price of unrefined oil increases which uncertainty in the Mideast region its amazing that no one has got the balls in congress to push the issue.

    All I see is politicians worried about loosing face or pissing on the people lining their pockets with cash.

    It needs to stop. I would agree there needs to be laws that force oil companies to reinvest in refining and their needs to be some price controls put into place to ease the fluxuation of the market.

    Too much of this country depends on gas and there is no fast or easy way to break that dependance. Ethenal is not a viable solution, and it took 20 years to get consumers into this idea of needing a big truck and its going to take another 20 or more to get them into thinking of buying a more energy saving car. However letting this market run as open as it is isn’t helping anyone, especially the poor families or overbudgetted families with small cars still paying $40-50 a tank to fill up for a week or two.

  3. While the electric industry in Michigan is regulated, it is also subject to market forces. The last administration passed a law which allows competition. There was a move to force competition which is the best means to balance supply and demand. The problem is that it is very difficult to transform an industry that historically was a government protected monopoly. Both major Michigan electric companies are lobbying very hard to get rid of competition.

    Once government gets involved, the market is not free to adjust to supply and demand pressures. Artificial low prices created through price controls inevitably leads to more demand and, thus, less supply. Think “shortages” and potential gas lines. While you may not feel gouged by the electric company, you might be surprised as to the vulnerability of the electrical grid around the midwest. In addition, when was the last time a new power plant was built in Michigan (although with our economy, the population is not growing which means lower demand)? Again, government created monopolies prevent new competitors, limits the deployment of new technology, stifles investment, and generally lowers customer service.

    There are laws on the books that deal with market manipulation and monopolistic practices and should be enforced, but government regulation (price controls) is a bad idea which has been proven over and over.

  4. Price controls are a bad idea, thats just frustration talking however setting a law into effect that forces a corporation (such as gas or electrical) to take a percentage of its excessive earnings and put it into building infrastructure isn’t.

    There has to be a balence. Right now its out of wack. There is zero incentive to improve the bottleneck and the problem thats causing these issues and it seems trying to force controls or even loosing controls in regards to companies doesn’t work.

    Government created monopolies may not work but a free market system means alot of the little guys have zero way to get into the field, they get stomped on and swallowed whole, providing just as little savings or customer service as the government monopoly companies.

    Look at the deregulated SBC/ATT/Southwest bell/PACBell beast we have now. It used to be you could call SBC or Michigan bell and get decent service and a low price on things. Now its bundling, and if you don’t like it good luck trying to find service outside of them. Cables even worse.

    Either way companies only care about the bottom line the trick is putting incentive for them to actually start caring about their customers.

  5. You left out the part of the story about the Attorney General running for Lieutentent Governor and he annouced the lawsuit a week before the Primary. He won’t win the lawsuit, but it might help him win the election. I bet he drops the lawsuit after the election.

    http://www.cspnet.com/ME2/dirmod.asp?sid=&nm=&type=Publishing&mod=Publications%3A%3AArticle&mid=8F3A7027421841978F18BE895F87F791&tier=4&id=826507C81D634621A329A1B4C6A5467C

    The press keeps misleading people with the stat about no one building a new refinery in 30 years. The oil companies have all been using their “excessive” profits from the past 10 years to expand exsisting refineries. The expanded refining capicity is the same as building several new refineries without hassles. Marathon just finished expanding the Detroit refinery last summer (which also lets them use more sour crude from Canada), and they are tring to buy up more property around them for an even bigger expansion.

    It is at least a 15 year process to build a new refinery (around 6 of those years are for the Federal permitting process). Plus, they need to find a spot that is close to exsisting piplines, and get approved for zoning. Which is probabally the hardest part, because no one wants to live by a refinery. They put off a horrible sulfur smell that covers miles around them.

    Also, as other people already said, price controls don’t work (proven in the 70’s). If Marathon loses this lawsuit and / or the current Federal Gouging Bill gets passed, you are going to see a major shortage the next time there is a supply problem. If a station owner can’t figure out what price is legal, they are just going to shut off the pumps instead of risk the rediculous fines.

  6. I’ve contacted everyone in my district and then some. I’ve received one call back with the bogus refingery excuse. I’ve asked questions until noone wants to speak with me apparently.

    Hopefully Mr. Cox can jump on this band wagon and get something rolling for us as well.

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