General Merchandise/HBC

CITGO Says 'No' to K2

Threatens to debrand marketers that continue to sell synthetic marijuana

HOUSTON -- Because of growing community concerns and amid protests over the sale of synthetic marijuana (K2), CITGO Petroleum Corp. has sent a letter to its marketers reminding them that the sale of these substances in a CITGO-branded location--even in states where legal--is prohibited under its Marketer Franchise Agreement, and their continued sale could lead to debranding.

The May 31, 2012, letter reads in full:

Dear CITGO-Branded Marketer,

As a valued CITGO Marketer, we know you share our commitment to supporting local communities in a variety of ways. One of the most fundamental ways you can help consumers is by keeping dangerous products off the shelves in CITGO-branded locations.

Substances such as synthetic marijuana and 'bath salts,' sold under a variety of names, including Spice and K2, have proven to be harmful substances, especially for teenagers. At least 40 states have banned their sale in some form and legislation is pending in other states. Clearly, the sale of these substances creates a negative image that is disparaging to the CITGO brand and the many individual identities that your retail locations have in their communities.

Therefore, the sale of these substances in a CITGO-branded location is prohibited under our Marketer Franchise Agreement (the "MFA"). Should sales of these substances at CITGO-branded locations continue after the date of this letter, CITGO may take such action as it deems appropriate to protect its brand image, including debranding the location.

If you have any questions, please contact your Region Manager. We thank you for your support and immediate action in this matter, and for your continuing support of your local community.


Alan Flagg, General Manager Light Oils Marketing, CITGO Petroleum Corp.

CITGO, through the Michigan Petroleum Association (MPA), also supported state Senate Bill 1082, legislation to combat the sale and use of synthetic marijuana in the state of Michigan. The Michigan State Senate passed the bill on May 30.

The company also supports the federal ban that is being championed by U.S. Senator Charles Schumer (D-N.Y.) and others.

Meanwhile, more than 200 people from across metropolitan Detroit attended a protest in front of a CITGO gas station in Shelby Township in Michigan on June 2 to encourage the retailer to stop selling K2, reported the Utica-Shelby Patch.

Protesters ranged from family members whose children are addicted to synthetic marijuana and concerned residents who are urging local gas stations, smoke shops and party stores to stop selling the legal drug. In recent weeks, K2 rallies have been organized across the state in front of businesses that refuse to stop selling K2, said the report.

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