Kentucky settles 2007 price gouging lawsuit with Marathon and Speedway for $22.5M

Kentucky will reap $22.5 million in settling a 12-year-old lawsuit against Marathon Petroleum Company and Speedway LLC for alleged price gouging following Hurricane Katrina in 2007, Attorney General Andy Beshear announced Wednesday.

Beshear said he will recommend that the state legislature appropriate the money, after fees and costs, to improve rural roads, navigable waterways and emergency management in severe weather.

“It makes sense that these and any future settlement funds from alleged price gouging of gas and oil prices go directly toward funding rural infrastructure, providing much-needed money for these vital projects,” said Beshear, the Democratic nominee running against Republican Gov. Matt Bevin in this year’s race for governor.

The settlement resolves claims that the Findlay, Ohio-based Marathon and Speedway violated Kentucky’s Consumer Protection Act by engaging in price gouging in the wholesale and retail sale of gasoline in the wake of Hurricane Katrina in 2007 and that Marathon engaged in wholesale price gouging following a 2011 flood in Kentucky. Speedway is a wholly owned subsidiary of Marathon.

“The settlement was 12 years in the making and I am proud to finally see its conclusion,” said Beshear in a statement.

Half of the agreed payment is due within 20 days of the settlement becoming effective and the rest will be paid annually in two equal installments, said Beshear.

Former Attorney General Greg Stumbo, who is running again this year for the office against Republican nominee Daniel Cameron, filed the lawsuit in May 2007. Then-Attorney General Jack Conway amended the complaint in 2011.

In the settlement, Marathon and Speedway make no admission of wrongdoing or liability. A trial in the case was to begin Aug. 13 in Franklin Circuit Court.

A separate lawsuit, filed in federal court in 2015, alleges Marathon violated antitrust law. That case is pending.