Thursday, September 01, 2011

Alvarez v. Chevron (9th Cir. - Sept. 1, 2011)

I'd have thought that this was a pretty good class action.

I didn't know that when you buy premium gasoline in many gas stations, you're not actually getting premium gasoline.  At least not at the outset.  Not that I actually buy premium gasoline.  But if I did, I'd definitely be interested to know that the first two- or three-tenths of a gallon that you receive out of the pump generally consists of non-premium gasoline that was left over from the previous person who used the pump.  So you are paying for, say, five gallons of premium gasoline but only receiving 4.7.

Admittedly, that may only deprive you of a dime (or less) each time.  But dimes add up.  Especially when you're doing it thousands of times and multiplying it by tens of thousands of customers.

Does this happen at all gas stations?  No.  Only ones with a single pump for multiple grades.  So gas stations could do what other gas stations do and have a separate handle for each grade.  Or they could charge you a little less, or make some disclosures.  None of which they do.  Hence the class action.

Again, I'd have thought that was a pretty decent claim.  But apparently I'm wrong.  It's allegedly preempted by various laws that regulate gasoline sales.  At least according to the Ninth Circuit.  So dismissal affirmed.

Still, it's something I'd have thought consumers should know.

My reaction, by the way, would be a little bit stronger if the defendants were actually benefitting from this practice.  But they're not.  Sure, regular gasoline is often left in the pump, which hoses (no pun intended) the buyers of premium gasoline.  But premium gasoline is then left in the pump for the next buyer, who then gets a "bonus" when the pump first begins.  So for the gas station owner, it's a wash; s/he still dispenses the same amount of expensive gasoline, so there's not a deception-based incentive to switch to single pumps.

That doesn't matter to the Ninth Circuit (which doesn't mention it), nor does it matter to the preemption analysis, but it made a difference to me when considering the equities of the dismissal.  It doesn't make the particular premium-grade consumer any happier, I'm sure.  But from a systemic and deterrence perspective, it has an impact.