Traverse City Record-Eagle

Archive: Friday

February 29, 2008

Company charged customers 'unlawful' prices

BY SHERI McWHIRTER

GRAYLING -- A circuit judge ordered a Gaylord company to reimburse its customers for overpriced propane this winter and issued a temporary restraining order to prevent the company from collecting fees or continuing to overcharge customers.

Inergy Propane of Kansas City, Mo., and the various companies it owns in northern Michigan charged at least $1 per gallon more than competing companies, 46th Circuit Trial Court Judge Janet Allen said.

Anyone charged more than $3 per gallon deserves a refund, she ruled, citing terms of the Michigan Consumer Protection.

"Gaylord Gas has engaged in unlawful practices," Allen said.

Inergy owns Gaylord Gas, Petoskey Propane and several other energy companies across the region, all named in a class action lawsuit filed by attorney Lawrence Friedman, a part-time Crawford County resident and Gaylord Gas customer. He requested the injunction while the civil case continues.

"This is about getting a company to do what's right," he said.

Friedman contends the company violated consumer protection laws by charging well above market prices for propane and not bothering to notify customers until they billed them. The company traps customers into paying inflated prices or excessive fees to change providers, he said.

Witnesses testified in a Grayling courtroom this week that they've been charged between $3.19 and $4.19 per gallon by Gaylord Gas this winter, even when they've signed contracts for lesser fixed rates.

"It is clear from the evidence there is no rhyme or reason to the prices," Friedman said.

Gaylord attorney Richard Bensinger represented Inergy Propane and argued there was no evidence to warrant a restraining order, but he declined to comment after the hearing.

Plaintiffs want Allen to be the "god of propane prices," Bensinger said in court as he argued the company does not charge excessive prices or inappropriate fees.

Allen ordered the company to mail her order to all of their customers within 14 days after she signs it and reimburse customers within a month. The company also cannot charge fees for customers to change providers, she said.

Jerome Dobrzelewski, 73, of Elmira, is a four-decade customer of Gaylord Gas and testified that he was overcharged.

"I think it's a good start, but I'm going to another company," Dobrzelewski said.

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