IRON RIVER, Mich. -- Krist Oil Co. and a Wisconsin citizen have filed a lawsuit challenging the constitutionality and legality of Wisconsin’s Unfair Sales Act, commonly known as the Minimum Markup Law.
The Wisconsin Institute for Law & Liberty (WILL) filed the lawsuit on behalf of the gasoline and diesel distributor and Green Bay resident Robert Lotto on Aug. 22 in Vilas County Circuit Court.
The suit asserts the law violates businesses’ right to serve their customers free of anticompetitive and arbitrary government regulation and consumers’ right to purchase products at the most competitive price. The Unfair Sales Act requires a 6% markup for retail sales of alcohol and tobacco, and a 9.18% markup for retail sales of motor fuel. It also prohibits retailers from selling any other products below cost.
Iron River, Mich.-based Krist Oil, which owns and operates convenience stores and gasoline stations throughout northern Wisconsin and the Upper Peninsula of Michigan, said in the lawsuit “its business objectives are best served by providing consumers of gasoline with the best product at the lowest possible prices … but it is not able to do so in Wisconsin.”
WILL has asked for a trial to force Wisconsin to prove that it has a reasonable and compelling interest in impeding commerce and protecting Wisconsin’s consumers from low prices. Unlike previous legal challenges, WILL and the plaintiffs—Krist Oil and Lotto—are asking the court to resolve the law’s contravention of Wisconsin’s constitutional guarantee to earn a living and to benefit from free markets.
“It’s important that the state of Wisconsin publicly stand up and argue how Wisconsin’s constitutional guarantee to earn a living is secondary to ensuring that protected special interests shouldn’t have to be subject to competition and that consumers should pay higher prices than market forces would call for,” said Rick Esenberg, WILL president and general counsel.
Krist Oil Co. is a family-owned gasoline and petroleum product retailer with more than 70 c-stores and gas stations in Wisconsin and Michigan, including roughly half in northern and northeastern Wisconsin.