Judge Signs Off On 14 Fuel Temperature Class Action Settlements

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After seven years of litigation, a Kansas federal judge preliminarily approved 14 of 18 proposed “hot fuel” class action settlements in the multidistrict litigation alleging that multiple motor fuel retailers sold gas without properly accounting for temperature expansion of the product.

U.S. District Court Judge Kathryn H. Vratil’s order preliminarily approving the proposed class action settlements was issued on Monday. The 14 approved settlement agreements will be used in a variety of states — including California, New Jersey, Pennsylvania and Florida — to help account for the cost of implementing automatic temperature compensation (ATC) at the pumps.

Chevron USA Inc. agreed to pay $2.1 million, the largest amount under the settlement agreements. Other defendants will pay smaller amounts totaling just under $700,000. The preliminarily approved fuel temperature class action settlements allow the plaintiffs to seek attorneys’ fees, litigation costs and incentive awards of up to 30 percent of the settlement funds.

In her order, Judge Vratil did not approve the four proposed hot fuel class action settlements where funds would become available to other states if the original state did not use its allocated portion of the settlement funds, including settlements proposed for E-Z Mart Stores Inc., Love’s Travel Stops & Country Stores Inc., Sunoco Inc. and Tesoro Refining and Marketing Co. LLC. Judge Vratil found that the provisions within those proposed settlements allowing funds to become available to other states is unfair to consumers within the original state.

Referencing multidistrict litigation regarding tax payers, Judge Vratil said, “[I]t appears that class members who purchased motor fuel in one state would not benefit by giving settlement funds which are allocated to their state to another state to implement ATC in that state.” The parties whose proposed fuel temperature settlements were not approved will have until Nov. 3 to revise their proposed class action settlements.

Judge Vratil granted Chevron summary judgment in July 2013 for claims in proposed California hot fuel class action lawsuits in the MDL. Judge Vratil ruled that the California plaintiffs did not sufficiently support their argument that California law bars the sale of fuel in the state without disclosing the effects of temperature expansion on gasoline.

In 2012, settlement agreements were made by Exxon Mobil Corp. and Valero Energy Corp. who agreed to pay $9 million. Also in 2012, BP PLC, Shell Oil Prducts US, and other companies reached settlements in the MDL totaling more than $16, according to court documents.

Also in Monday’s order, Judge Vratil appointed Robert A. Horn of Horn, Aylward & Bandy LLC, Thomas V. Girardi of Girardi Keese and George A. Zelcs of Korein Tillery LLC as lead counsel and Thomas V. Bender of Walters Bender Strohbehn & Vaughan PC as liaison counsel for the proposed settlement classes.

The plaintiffs are represented by Korein Tillery LLC, Horn Aylward & Bandy LLC, Stueve Siegel Hanson LLP and Walters Bender Strohbehn & Vaughan PC.

The Fuel Temperature Class Action Lawsuit is In re: Motor Fuel Temperature Sales Practices Litigation, Case No. 2:07-md-01840, in the U.S. District Court for the District of Kansas.