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The companies are shielded from future prosecution by the state and by any county prosecutors who signed off on the agreement (as of Monday afternoon, 10 had).
Jason Harms, a vice president at Harms Oil, affirmed that.
Oil of Rapid City and Harms Oil of Brookings to close out a wide ranging investigation of mislabeled gasoline in several counties. Here's what the consent judgments filed in Hughes County Court say:
The companies were targeted in a wide ranging investigation of mislabeled gasoline that began in March. They will be required to submit quarterly compliance reports, and Harms Oil will pay the attorney general's office an additional $21,500 fine that will be deposited in the state general fund.
Neither company admitted wrongdoing.
in this judgment shall constitute an admission or concession by (the companies) . or of any violation of state or federal law, rule or regulation, or any other liability or wrongdoing whatsoever."
Fuel mislabeling punished
Jackley declined to elaborate on the scope of the mislabeling or say whether other wholesalers are under investigation.
Neither company admitted guilt. "Nothing contained Converse All Star Ox Mono Women's
Both companies must pay $25,000 toward the cost of new octane Converse All Star All Black Hi Tops testing equipment the Department of Public Safety bought earlier this past year, and $3,500 to produce and mail educational materials to every fuel station in the state. Harms Oil will pay the Attorney General's office an additional $21,500, which Jackley said will be deposited in the state general fund.
No profits said neither company's financial records showed "unusual profits" from moving 85 octane gasoline into eastern South Dakota. He said his office did not estimate potential damages to consumers who unknowingly bought lower octane fuel.
"There weren't any extra profits," he said. "When we have a supply agreement Womens Converse All Star
In addition, until a rule change in 2009, fuel labels only had to be accurate within two octane points. The companies maintain that the new rules requiring accurate labeling "was not well communicated to the gasoline industry."
It's unclear whether the companies' outside retail customers were unaware of the octane content of their fuel shipments, and so mislabeled the pumps unknowingly, or knew what they were getting but mislabeled it anyway.
"I don't want to get into the settlement resolution, but part of it was just the volume of sales," Jackley said of the additional payment from Harms. Oil already has incurred costs defending itself against criminal action in Beadle County. In November, the company pleaded no contest to selling 85 octane fuel at its five Corner Pantry stations in Huron. It was fined $2,500 and given 100 hours of community service.
That's why the western terminals, where 85 octane gasoline is sold as regular unleaded, "are an important and necessary source . of gasoline for all of South Dakota," the settlements read.
For two years, both companies must submit quarterly compliance reports that show they have not delivered 85 octane gasoline to retailers outside of the nine West River counties in which it is now legal.
A 2009 amendment to state rules that disallowed a traditional two point variance in octane ratings "was not well communicated to the gasoline industry."Two companies accused of selling mislabeled fuel must reimburse the state for octane testing equipment and pay for educational brochures at fuel stations throughout the state. Oil of Rapid City major wholesalers that also own retail stations will pay $25,000 to reimburse the Department of Public Safety for new octane testing equipment, plus $3,500 to produce educational materials that will be sent to every retail station in the state.
Because of frequent supply shortages, "it was a common and well accepted practice by both the gasoline industry in South Dakota and the state (government) of South Dakota" that lower octane fuel would occasionally be shipped from western terminals to eastern South Dakota.
customer, we charge our cost, plus freight, plus a fixed margin whether it was gas that came out of the east or gas out of the west."Asked whether he thought his company's reputation had taken a hit, Harms replied: "Absolutely. We've certainly been sensitive to the story that's been out there. It's been disappointing."
Neither company "realized any unusual profits or unusual profit margins" as a result of shipping lower octane gasoline from western pipeline terminals into eastern South Dakota.
"There's actually a pretty strong argument that the (savings) were passed on to the consumers," he said.
In the settlements, the companies said moving lower octane fuel from western pipeline terminals always has been a "common and well accepted practice" by an industry that faces perpetual supply shortages.
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