Smart SpendingSmart Spending

'Hot fuel' suits get class-action status

The settlement of a similar suit required Costco to install new pumps that deliver more fuel when gas is over a certain temperature.

By Karen Datko Jun 7, 2010 3:58PM

This post comes from Jon Hood at partner site


A Kansas federal judge has granted class-action status to two lawsuits alleging that multiple retailers are ripping off consumers by selling them "hot fuel."


The ruling by U.S. District Judge Kathryn Vratil allows the suits -- which involve 12 separate retailers -- to proceed.

What is hot fuel? Simply put, it's a matter of chemistry. Since fuel is a liquid, as its temperature increases, so does its volume. That means that hotter gas has less energy than it would at lower temperatures, and that consumers thus drive off with less usable fuel in their tanks.


Industry standards dictate that retailers should not sell fuel that is hotter than 60 degrees Fahrenheit without making adjustments to the gas's volume.


The companies named as defendants are Chevron, Citgo, Shell, Valero, ConocoPhillips, 7-Eleven, Wal-Mart, Circle K, Casey's General Stores, Kum & Go, QuikTrip, and -- in case it didn't already have enough on its plate -- BP.


One of the plaintiffs' attorneys, Bob Horn of Kansas City-based Horn, Aylward & Bandy, called the ruling "a great order, frankly," according to the Kansas City Star. Another attorney, George Zelcs of Korein Tillery in Chicago, called the case a "bellwether" for other hot fuel suits.


That may be true, but the suit is hardly hot fuel's first rodeo. In 2009, Costco settled a suit alleging that it sold hot fuel to consumers in 25 states. The settlement required Costco locations in 14 states to install new pumps that deliver slightly more fuel when the gas's temperature is above a certain degree.


Judge Vratil, who oversaw that settlement as well, dismissed retailers' argument that the mandate would interfere with the industry requirement that they sell gas at 231 cubic inches.


Vratil wrote that the retailers had "not shown ... that state regulation actually prohibits them from adjusting the size of a gallon of motor fuel to account for thermal expansion."


All available data indicate that consumers are paying dearly for fuel that isn't being sold at the proper temperature. The attorneys in the Costco suit estimated that their clients lost between $40 and $100 a year, assuming that they regularly bought their gas at Costco. A 2006 investigation by the Star found that "U.S. consumers are spending about $2.3 billion more for gasoline and diesel this year than they otherwise would if fuel pumps were adjusted to account for expansion of hot fuel."


And with the economy still struggling, and gas prices likely to rise again, every penny counts.


More from and MSN Money:



Copyright © 2014 Microsoft. All rights reserved.

Fundamental company data and historical chart data provided by Morningstar Inc. Real-time index quotes and delayed quotes supplied by Morningstar Inc. Quotes delayed by up to 15 minutes, except where indicated otherwise. Fund summary, fund performance and dividend data provided by Morningstar Inc. Analyst recommendations provided by Zacks Investment Research. StockScouter data provided by Verus Analytics. IPO data provided by Hoover's Inc. Index membership data provided by Morningstar Inc.


Smart Spending brings you the best money-saving tips from MSN Money and the rest of the Web. Join the conversation on Facebook and follow us on Twitter.