The Federal Trade Commission (FTC) has sued 7-Eleven Inc. alleging that the convenience-store chain violated a 2018 consent order by acquiring a fuel outlet in St. Petersburg, Florida, without providing the commission prior notice.
7-Eleven said it is working with the FTC to correct what it called an “oversight.”
According to the complaint, which also names 7-Eleven’s parent company, Tokyo-based Seven & i Holdings Co. Ltd., 7-Eleven’s acquisition of the St. Petersburg outlet “plainly violated the consent order, was anticompetitive and likely allowed 7-Eleven to charge higher fuel prices at locations near the St. Petersburg location,” the commission said.
The FTC is seeking a civil penalty for a four-year violation period, starting when 7-Eleven acquired the outlet without giving the required notice. 7-Eleven faces a maximum penalty of more than $77 million.
The consent order stems from 7-Eleven’s $3.3 billion acquisition of more than 1,000 retail fuel outlets with c-stores from Sunoco in 2018. 7-Eleven and its parent company agreed to a consent order to settle FTC charges that its proposed acquisition would harm competition for retail gas and diesel fuel in certain local markets, resulting in consumers paying higher fuel prices. The consent order, among other conditions, prohibited 7-Eleven from acquiring Sunoco fuel outlets in many of these local markets, including in the local market surrounding the St. Petersburg location in the Tampa, Florida, metropolitan area, and required 7-Eleven to provide the FTC with notice before acquiring any interest in specific third-party retail fuel outlets in certain local markets for a period of 10 years.
According to the complaint, 7-Eleven’s acquisition of the St. Petersburg outlet was an undisputed violation of the 2018 consent order since this location was specifically listed as an outlet that could not be acquired without first providing prior notice to the FTC. 7-Eleven submitted false compliance reports to the FTC related to this acquisition, the commission alleges. The FTC is seeking civil penalties for 7-Eleven’s violation of the consent order “to protect the public interest and deter 7-Eleven, a serial acquirer of retail fuel outlets across the United States, and others from flouting future consent orders,” the FTC’s complaint says.
The Commission vote authorizing staff to file a complaint and seek civil penalties was 3-0. The complaint was filed in the U.S. District Court for the District of Columbia.
“We are aware of the lawsuit filed [Monday] by the Federal Trade Commission (FTC). We have been working in good faith with the FTC to rectify an oversight involving one store in St. Petersburg, Florida. Not only did we self-report to the FTC after discovering this unintentional error, but we also then divested this store expeditiously. We hope this matter can be resolved quickly and fairly,” 7-Eleven said in a statement provided to CSP.
Irving, Texas-based 7-Eleven operates, franchises or licenses more than 13,000 stores in the United States and Canada. In addition to 7-Eleven stores, the company operates and franchises Speedway and Stripes stores and the Laredo Taco Company and Raise the Roost Chicken and Biscuits brands. 7-Eleven Inc. is No. 1 on CSP’s 2023 Top 202 ranking of U.S. convenience-store chains by store count.
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