Houston Gas Stations Overcharged Motorists, Jury Finds

A Harris County, Texas jury has decided the Houston-based owner of SunMart convenience stores must pay $30 million in damages for overcharging customers. $18 million of that will go to consumers.

The verdict follows an investigation by the State of Texas that found SunMart's gas pumps at 86 stations in Texas provided less than a full gallon of fuel for each gallon charged.

Consumers must put their faith in the accuracy of the gas pump, believing that when it shows one gallon of fuel has been dispensed, that is the actual amount. State governments routinely monitor gas stations, to ensure that faith is not misplaced.

In July 2008, Texas Attorney General Abbott charged the parent company, Petroleum Wholesale, L.P. (PWI) with defrauding gasoline purchasers. At the time, gasoline prices were at a record high.

Less than a full gallon

"The jury's verdict reflects a significant and well-deserved rebuke to SunMart's fraudulent pump calibration scheme," Abbott said. "After carefully considering the evidence during an eight-week trial, the jury concluded the defendant illegally set its gasoline pumps to deliver less than a full gallon of fuel."

Texas Agriculture Commission Todd Staples, whose department conducted the initial investigation, said the jury's verdict sends a strong message.

"In Texas, we demand that we get what we pay for," Staples said. "One Texan cheated is one too many. The Texans who served on this jury have made a decision that will further strengthen consumer confidence and sends a clear signal that Texans will not tolerate deceptive sales practices by anyone."

In July 2008, dozens of state inspectors conducted Operation Spotlight - a multi-county effort to inspect and test 1,701 gasoline pumps at 86 SunMart stores. After testing 1,701 SunMart pumps, TDA investigators determined that 985 were dispensing less than a full gallon of fuel.

Calibrated to dispense less than a gallon

According to court documents filed by the State, 58 percent of SunMart's pumps were calibrated to dispense less than a full gallon of fuel. The state maintained that, while Operation Spotlight was still ongoing, PWI attempted to cover-up its improper calibration scheme by dispatching company personnel and third-party contractors to recalibrate pumps before TDA inspectors could reach all 86 SunMart locations.

Staples launched Operation Spotlight after he learned that PWI routinely failed TDA inspections. Under Texas law, the Agriculture Commissioner is charged with regulating weights and measures - including gasoline pumps. Later, TDA referred their findings to the Texas Attorney General's Office, which charged PWI with violating the Texas Deceptive Trade Practices Act. The State's enforcement action indicates PWI illegally calibrated and maintained their fuel pumps in a manner that defrauded their customers.

During the eight-week trial, a team of four Assistant Attorneys General provided jurors 48 boxes of fuel receipts - which covered 5,766,243 gallons of gasoline and 727,339 fraudulent sales transactions. The jury's $30 million verdict was based upon consumer transactions and penalties per violation of the DTPA. The jury found Petroleum Wholesale, L.P. liable for $18,765,411 in restitution, $8,494,212 in civil penalties and more than $2.7 million in fees to the State.