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Costco sues protester in gas price dispute

Does Costco really have the cheapest gas prices in town? A retiree says no and pickets outside the store to make his point.

By Karen Datko Apr 7, 2011 10:59AM

Costco members love to rave about the warehouse store's gas prices -- so low, they say, they're worth driving out of your way for (unless you drive too far).


So why has a retired psychologist picketed outside a California Costco for three months, claiming Costco's gas is a rip-off? And why has Costco taken the guy to court? This dispute has gotten ugly. Post continues after video.

The picketer, Will Powers, claims that Costco falsely markets its gas as the cheapest gas in town. Reports Nick Wilson of The Tribune of San Luis Obispo:

He acknowledged that the store matches the lowest prices of other local gas stations. But requiring a Costco membership card and a debit, Costco cash or American Express card to use the station actually increases the price of gas for Costco customers over prices at other stations, Powers claims.

Costco sued, saying Powers has trespassed, threatened an employee, blocked traffic and called workers "fascist (an eight-letter "b" word we're not allowed to use here)." Powers acknowledged using the word "fascists" but denied the rest of the claims. (You can see video here.)

Comments left at the newspaper's website devolved into a liberal vs. conservative battle (which seems to happen online no matter what the topic is these days). Here are several that seemed more germane to the story:

  • From "E_T_2": "No matter how crazy this guy's protest is I find it amazing that a big box store like Costco goes on to sue."
  • From "Insider": "Of all the good causes out there to rally for, he picks Costco gas prices? Seriously?"
  • "WeizenBitte" said: "I always wondered what his beef was."

Is buying gas at Costco your best bet? It depends, personal-finance blogger Money Beagle concluded in a post called "When filling up at Costco doesn't make sense."

None of the stores is near where we typically go. … Unless we're driving past one or making a planned shopping trip, the 'cost' of getting gas would be about one gallon. 

More from MSN Money:

Apr 7, 2011 2:35PM

I've found it's rarely worth the few cents my car has a 13 gallon gas tank...If I buy Gas at One Station for $3.89 a gallon or down the street at another Station for $3.84 a gallon then I save a whopping 65 cents for a tank of gas (That's if I am sucking fumes)...If I saved $10.00 per tank I'd be waiting in line but its really not that big a deal to me. I shop where I happen to need gas at the moment...


These people in line at Costco for 30 minutes...Well I'll just drive by and smile at you with my full tank of gas!

Apr 7, 2011 2:30PM

Of all things to worry about, the cost of gas at Cosco and this retiree's protest are not one of them. Thumbs down

Apr 7, 2011 1:19PM
The old bastard needs to find a new hobby. Most adults are capable of reading the big price signs at gas stations. Some are even intelligent enough to know which price is the lowest.
Apr 7, 2011 1:51PM
if you really get your panties in a knot over a gas station's false advertising you really need more to worry about.

as a psychologist you would think that guy would realize he is transferring his hidden aggression towards his father who always had gas at the dinner table towards the big evil corporation whom he feels powerless to stop. 

Apr 7, 2011 1:34PM
Um Dimitry -- 1st Amendment doesn't apply to a private property -- only to public forums -- Costco's parking lot is not a public forum -- if he was on Costco's property he damned well is subject to them kicking his a$$ off their premises.  Now - it's a different story if he was across on the public sidewalk near but not on Costco premises.  Now I don't know if there is any value to his claims -- probably -- but Costco has a right to sue him for libel if they aren't cand they can prove that his claims are false.
Apr 7, 2011 2:25PM
People need to do the math.  If a car gets 25 MPG, a fill up for it averages 12 gallons, and Costco is 12 cents a gallon cheaper than the local neighborhood station...   but going to Costco is a 10 mile round trip?  With gas being around $4.00 a gallon, you actually lost money by going to Costco to fill up.  It only makes sense to fill up there if you're in the area already, or are going to Costco to shop.

The Costco Amex thing?  It's actually a great deal - you get a rebate from them of 4-5% on gas purchases.  That's a savings of 15-20 cents a gallon, and it applies at any gas station, not just Costco!

I had one recent issue with Costco gas, however, where I think something was amiss and worth complaining about.  My car averages 20 mpg, my wife's around 22.  A few weeks ago, we filled up one day apart at our local Costco - and the math said I got 14 mpg, and my wife 15.  Nothing had changed in our driving habits, so that tells me either we both got a bad tank of gas on our previous visit, or we didn't put in nearly as much gas as we paid for on our current trip to the pumps.  The next tank for both cars, our mileage was back to normal.  This had happened to me once before, at a different Costco...  so my eyebrows are definitely raised.  Whether it's bad gas or an inaccurate pump, any savings you get from filling up at Costco disappear if your mileage drops 30%!

Apr 7, 2011 1:47PM
I pray I don't spend my retirement picketing some store over gas prices. Poor guy's just looking for some attention - and he's getting it!
Apr 7, 2011 2:26PM
Costco gas is cheap.  Just like they advertise, cheap.  Cheap is not best value, cheap is cheap.  Just a lower grade and cost a few cents less.  Would rather pay the 5-7 cents per gallon more and use a closer fueling station that is offering an ethanol free product.  I find it interesting that people will defend box stores like Costco, because they can get more cereal.  Ok it works for the right person but not ALL their products are of good value.  Do your diligence and you will find many products that you can get elsewhere for a better price.  Gas is not gas.  And I would rather look for a good value than go cheap.  Cheap is Cheap. 
Apr 7, 2011 2:30PM
I absolutely support one's right to picket, free speech, etc., until they overstep their bounds (go on private property, lie to the public, incite rioting, etc.).  But it's about dang time that a company fought back said enough is enough.  The picketer obviously doesn't know what he's talking about.
Apr 7, 2011 3:11PM
It's called a SLAPP. Selective Lawsuit Against Public Participation.  Winning isn't the point.  Silencing criticism, or making it costly is, whether the criticism comes from the right or the left.  Works for those with the most financial staying power.  
Apr 7, 2011 2:22PM
If I didn't have to buy Beano to control my gas problem, I would have the cheapest gas in town.
Apr 7, 2011 1:40PM
I can't wait until I'm retired and have nothing better to do also.
Apr 7, 2011 2:02PM

I pay with a debit card and have an executive account. No interest for a debit card and the 2% I save per year paid to me by Costco for using the executive account pays for the card. No cost to me to shop Costco. I will say I don’t remember seeing anywhere here in CA that Costco states they are the cheapest in town. I like using this service or product as I know it is always one of the lowest. I don’t want to waste time and gas searching to save one or two cents a gallon. This guy may be attempting to express his opinion but it should not be at the cost of harassing Costco staff or the stores shoppers.


Jive Turkey:


I am a staunch Republican but there is a problem we need to address as a nation.

There is no transparency in these swaps.   That is one of the reasons we had the housing meltdown.   No one knew how much money people were losing and they still don't.  Why do you think we have a debt of US $3 trillion today?   More than all the other 2010 years of this country's spending combined.  We are giving away money by the rail cars to SOMEONE.


The notional value of these trades in the US alone is US $615 Trillion in 2009.  It is more today.   That is 10 times the Gross National Product of all countries on Earth combined.  


England has an even greater value than does the US in over the counter trades.

I for one would like to know by whom and where these trades are being made.   Who is controlling whether I have the money to drive to my job next week or do I get to go on a vacation this summer.   

Prices at the pumps at Costco or any other station have nothing to do with Libya (less than 5% of our oil comes from there) or any thing else.  


It is strictly speculation by Hedge funds who have given money to the Campaigns of most of the people voted into office in Washington to not make these trade transparent. 


If Will Powers would like to do something good, he should be out protesting the OTC swaps for oil and other products made with crude oil.


They can trade the swaps, but they need to be transparent and the price of oil will come back down to US $32 a barrel immediately.


The ONLY reason gas prices are so high anywhere is the fact traders are allowed to speculate on the price of gas on over the counter markets that are not disclosed.   Oil should not be allowed to be speculated on other than for those that use oil products in their business such as airlines, large distributors or energy producers.


Apr 7, 2011 1:29PM
As usual these comments appear to be an essay in a remedial reading course. There is exactly one response so far on point. Now there will be two.
1. The protester is correct, at least as far as noting that refusing to accept cash adds fees to the transaction, plus the cost of a membership. That means the prices aren't the lowest if they only match the next lowest price in town.
2. Membership in Costco does not give its members immunity from trespassing charges. Do you think you could break in after hours and claim membership as a defense?
3. The first amendment protects free speech only from censorship imposed by the government. A private business can limit your speech on their property. 
4. What a waste of time and energy. Protesting the false advertisement aspect instead of talking about what's happening to fuel prices in general and why?
Apr 7, 2011 2:05PM

I live on Honolulu, in Hawaii.   The posted price of gasoline at Costco is fairly consistent about being a few cents less than others.  I would rather turn the corner and go to the lineless station 1/2 mile away for 3 cents a gal. more a 20 gal tank we are talking 60 cents,,,,well worth it!


Apr 7, 2011 12:58PM

hey you do not like the price go somewhere else.  I remember as a student at cal poly in the 60's the local tv station taped a protest that showed that we at cal poly were protesting the war in asia. But in fact there were only a few of the students were protesting. We told the TV Station to report with true facts or we would not shop at those stores that advertised on their station and the station found out that we did have the power and they came back and did an accurate presentation of the protesters. Is this another case of the media using its power to show something that is not factual.

Costco does not require the members to by gas at their stations. but  I have found that they are usually the lowest in town. but remember all cost for gas change daily and they tend to change with each truck load. Some one else may have purchased yesterday that today..../

Apr 7, 2011 2:05PM
I live in Atascadero, and shop at Costco for my gas (but only when I am in town)
1) I have a Costco Card, not to buy gas so the membership fee will be paid whether I not get gas, you get no rebate on gas purchases
2) I shop at Costco  every couple weeks, because I save money.
3) I use my Costco American Express and I get a annual rebate of my gas
4) I have proof of my gas purchases on my American Express bill
I pay no annual fees for my American Express. 

Is it the cheapest in town or it ties the closest station, so I can not use cash, I would rather use my Costco American express and pay it off monthly because I can actually track my usage.

I have seen the protestor at the Costco Store and seen him  disrupt the flow of traffic to the pumps. If he stood at the entrance into the parking lot  there would be no issue. But standing on Costco parking lot  close to the pumps is another issue.
It is people's right chose where to buy their gas, it is his right to protest, but only at the parking lot entrance not in close proximity to the pumps.
Apr 7, 2011 3:59PM
I have the utmost respect for the man for standing up for what he believes in. Pretty soon, airlines too, will start charging for in-flight usage of bathrooms and oxygen. Whether it be gas or any other necessity, if  businesses get away with all their smoking mirrors and tricks, at the end, it is the consumer who ends up paying. Of course, "if you don't like our prices then go somewhere else", as someone pointed out in their reply, but is it so wrong to bring the truth out?

Here I sit hearing how President is created 250,000 jobs while I see millions of technology jobs shipped out to INDIA, thanks to our previous and current administration. ATM fees will be $5.00 (Chase has already launched the pilot).

And had someone not pointed out what was COSTCO doing with membership renewals, COSTCO wouldn't have settled a multimillion dollar lawsuit back in 2009 or so. Here is the link:

I can certainly say, Hey, every other country has such misleading business dealings, why not in America? Just look away and let it go on.....

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