The owners want the court to force BP to stay with the existing agreement [image-nocss] and prevent it from making significant changes.
In a September 18 conference call with the operators, BP said it would not renew the deals and wanted to exit the agreements, court documents cited by the newspaper said. Instead, the company offered to sell the stations to the operators at "inflated" prices that "far exceed market value," the documents said.
In addition, BP "has indicated" that if the court rules that the current contracts must remain in place, the company will come up with requirements on the operators that are "even more onerous than those presently in force," the documents also said, according to the report.
"We can hardly make ends meet right now," Raffi Korogluyan, who owns stations in Hasbrouck Heights, Paterson and North Bergen, told the Record. "How are we going to meet all these costs? There's no way. We will be out of business." He said he is particularly upset because, based on BP's pledge to keep the existing contracts, he bought the lease on his North Bergen station in 2007 for $200,000.
Ilona I. Khorza, a Parsippany attorney representing BP, told the Record that the company would not comment on the suit. BP spokesperson Scott Dean told CSP Daily News, "We do not comment on pending legal matters."
The station operators said they are especially angry because the company wants to charge top dollar for businesses they have built and improved over the years, said the report.
Ara Alboyacian, who operates two BP stations in Fort Lee, N.J., told the paper that the company offered to sell him one of the stations for $1.2 million, a price that included the business but not the land, which is owned by someone else. He called the price "outrageous."
According to the report, the suit claims that the operators are de facto franchisees, and that BP has for years "implemented a strategy of oppressing" the operators in the hope that they will abandon their stations. This has included shifting responsibility for repair and replacement of underground tanks to the operators and manipulating gasoline prices to hurt the operators, the suit alleged. BP also has not increased the price per gallon commission paid to operators from the 12 cents set in 1998, the operators added.
The suit accuses BP of violating New Jersey's franchise law, fraud and unjust enrichment.
The operators filed suit in 2006 after BP sought to end the contracts and introduce "lease and supply" agreements that would have increased the rents paid by the stations, in some cases by tenfold, the suit said. U.S. District Court Judge Dennis M. Cavanaugh sided with the operators, granting them a temporary injunction. The case was dismissed after BP agreed to continue with the then-existing operating agreements.
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