H-2256

AN ACT Relating to the marketing of motor fuels; adding a new chapter to Title 78 RCW; creating new sections; and declaring an emergency.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:

NEW SECTION. Sec. 1. DECLARATION OF POLICY. The legislature finds and declares that the distribution and sale of motor fuels in the state of Washington vitally affects the general economy of the state and the public interest and the public welfare, and that in order to promote the public interest and public welfare, it is necessary to eliminate excessive wholesale prices and prevent unfair allocation of motor fuels.

NEW SECTION. Sec. 2. DEFINITIONS. The definitions set forth in this section apply throughout this chapter.

(1) "Affiliate" means a person, firm, or corporation controlling or controlled by an oil company, and includes a subsidiary or affiliated corporation in which the oil company or its shareholders, officers, agents, or employees hold or control more than twenty-five percent of the voting shares.

(2) "Brand name" or "trademark" means a trademark, trade name, service mark, or other identifying symbol or name.

(3) "Company-operated station" means a service station that is operated by an oil company, its subsidiary, or its affiliate.

(4) "Cost of selling motor fuel to the public" means the fair market value of transporting the motor fuel from the terminal to the company-operated station, goods, services, facilities, space, construction, utilities, insurance, labor, repair, maintenance, and all products, services, or materials consumed, furnished, expended, or incurred by an oil company to own and operate a company-operated station and sell motor fuel at that facility. "Cost of selling motor fuel to the public" does not include the cost of refining crude oil into motor fuel, the cost of delivering motor fuel to the truck loading terminal, or the cost of selling products or services other than motor fuel at the company-operated station.

(5) "Dealer price" means the net price per gallon of motor fuel sold to an independent dealer and delivered to a service station by an oil company after adjustment for the fair market value of transportation of the motor fuel from the truck loading terminal, commissions, brokerages, rebates, discounts, services or facilities furnished, or other such adjustment. An adjustment of the dealer price must take into account the service station rents, credit fees, franchise fees, or other charges related to the sale of motor fuel paid to the oil company by the independent dealer.

(6) "Discriminatory wholesale price" means a price that is prohibited by section 4 of this act.

(7) "Independent dealer" means a person who or entity that operates a service station, whether or not the station is owned by an oil company, its subsidiary, or its affiliate. "Independent dealer" does not include an oil company.

(8) "Motor fuel" means a particular blend of gasoline or diesel fuel used in motor vehicles, however modified, that meets industry standards for composition and octane and that is marketed under the same brand name or trademark.

(9) "Oil company" means a person, firm, or corporation, including an affiliate of the person, firm, or corporation, engaged in the refining of crude oil into motor fuel.

(10) "Retail price" means the net price per gallon of motor fuel sold by an oil company at a company-operated station to a retail customer, after adjustment for the costs of selling motor fuel to the public.

(11) "Service station" means a facility that sells motor fuels that are dispensed directly into motor vehicles and not operated by an oil company.

(12) "Truck loading terminal" means the point of transfer of motor fuel from a pipeline or a tank storage facility into a truck or other vehicle for delivery to a wholesale purchaser or retail service station.

(13) "Wholesale price" means the net price per gallon of motor fuel sold to a wholesale purchaser by an oil company at a truck loading terminal after adjustment for the fair market value of commissions, brokerages, rebates, discounts, services or facilities furnished, or other such adjustment. An adjustment of the wholesale price must take into account the service station rents, credit fees, franchise fees, or other charges related to the sale of motor fuel paid to the oil company by the wholesale purchaser.

(14) "Wholesale purchaser" means a person, firm, or corporation that purchases motor fuel from an oil company for resale to the public or others. "Wholesale purchaser" does not include government agencies, railroad companies, airlines, public utilities, or an oil company.

NEW SECTION. Sec. 3. SUPPLY LIMITATIONS--UNIFORMITY. If the supply of motor fuel is limited by an oil company for any reason, the oil company shall impose the limitations equally and uniformly on company-operated stations, independent dealers, and all wholesale purchasers that have a supply agreement with the oil company and are supplied motor fuel from the same truck loading terminal.

NEW SECTION. Sec. 4. DISCRIMINATORY OIL COMPANY WHOLESALE PRICES. (1) When establishing a retail price, dealer price, or wholesale price for motor fuel sold at or delivered from the same truck loading terminal, an oil company may not:

(a) Discriminate in dealer price between independent dealers or charge a dealer price that is higher than its retail price;

(b) Discriminate in wholesale price between wholesale purchasers or charge a higher wholesale price than either its dealer price or its retail price.

(2) Nothing in this section prevents differentials that make only due allowance for differences in an oil company's actual cost of manufacture, sale, or delivery resulting from the differing methods or quantities in which motor fuels are sold or delivered to independent dealers or wholesale purchasers.

NEW SECTION. Sec. 5. DISCRIMINATORY WHOLESALE PRICES--ILLEGALITY. It is unlawful for an oil company to charge an independent dealer or wholesale purchaser a discriminatory wholesale price. Charging a discriminatory wholesale price is a violation of this chapter.

NEW SECTION. Sec. 6. RECORDS. An oil company that sells motor fuel in this state shall keep for three years from the date of sale a written record consisting of its wholesale prices, its dealer prices, and its retail prices for each location in this state at which it sells or delivers motor fuel and for each grade of motor fuel sold.

NEW SECTION. Sec. 7. CIVIL ACTIONS BY THE ATTORNEY GENERAL. (1) The attorney general may bring an action in the name of the state against an oil company to restrain and prevent an oil company from violating any provision of this chapter. In the discretion of the court, the attorney general may recover the costs of the action, including a reasonable attorney's fee.

(2) The court may make such additional orders or judgments as may be necessary to restore to a person in interest any moneys or property, real or personal, that may have been acquired by an oil company as a result of violations of this chapter.

NEW SECTION. Sec. 8. CIVIL ACTIONS BY A PURCHASER. An independent dealer or wholesale purchaser of motor fuel from an oil company who has been damaged by a violation of this chapter may bring an action in superior court to enjoin further violation of this chapter and to recover damages sustained, including costs of the suit and reasonable attorneys' fees.

NEW SECTION. Sec. 9. DAMAGES. (1) In an action brought under this chapter, upon proof that a discriminatory wholesale price has been charged and paid, the court shall conclusively presume that the damages sustained are at least equal to the number of gallons sold at the discriminatory wholesale price times the amount that the price exceeds either:

(a) The dealer price under section 4 of this act, if the motor fuel was delivered to the purchaser; or

(b) The wholesale price under section 4 of this act, if delivery of the motor fuel was taken at the truck loading terminal.

(2) In addition to the damages established under subsection (1) of this section, the plaintiff may establish any further damages sustained as a result of a violation of this chapter, including but not limited to costs of the suit and reasonable attorneys' fees.

NEW SECTION. Sec. 10. SHORT TITLE. This act shall be known as the "Gasoline Price and Supply Fairness Act."

NEW SECTION. Sec. 11. SEVERABILITY. If any provision of this act or its application to any person or circumstance is held invalid, the remainder of the act or the application of the provision to other persons or circumstances is not affected.

NEW SECTION. Sec. 12. PROSPECTIVE APPLICATION. This act applies prospectively to all actions and conduct occurring after the effective date of this act.

NEW SECTION. Sec. 13. LIBERAL CONSTRUCTION. This act shall be liberally construed to give full effect to the objectives and purposes for which it was enacted.

NEW SECTION. Sec. 14. CAPTIONS. Section headings used in this act do not constitute any part of the law.

NEW SECTION. Sec. 15. CODIFICATION. Sections 1 through 9 of this act shall constitute a new chapter in Title 78 RCW, mines, minerals, and petroleum law.

NEW SECTION. Sec. 16. EFFECTIVE DATE. This act is necessary for the immediate preservation of the public peace, health, or safety, or support of the state government and its existing public institutions, and shall take effect immediately.