According to the statement released by SeegerWeiss LLP and Lee Tran & Liang APLC, the allegedly "wrongful [image-nocss] and illegal" conduct set forth in the complaint includes the following: BP defendants required all franchisees to install a new centralized POS system developed by Retalix that is defective, which in turn, resulted in substantial damages to the franchisees such as lost operation time, lost revenue, lost or inaccurate inventory, lost receivables and cash and increased operating costs and burdens; BP's illegal manipulation of gasoline supply and pricing; BP's improper direct control of and/or pricing by third-party vendors; and BP's policy of forcing sale of items and collection of fees for which the plaintiffs receive no compensation.
There are more than 1,600 franchised BP and ARCO stations and ampm stores across the country, all of which could potentially be part of the proposed class for this lawsuit, the firm said.
The Service Station Franchise Association Inc. (SSFA), which represents a large number of the franchisees, "has been instrumental in assisting the plaintiffs in their quest to bring the defendants to justice via this action," the law firms added.
Documents obtained by CSP Daily News indicate that the SSFA was in talks with BP over the situation. The SSFA is asking BP to: Fix the system or take it out of the franchisees stores and allow buy their own systems. Not charge franchisees for the system. Pay franchisees for losses. Indemnify franchisees for any future problems with the system, including tax audits or government actions. Implement "good-faith" changes to the financial arrangement with franchisees, such as eliminating the royalty on tobacco products and implementing a cents-per-gallon environmental cost support rebate on gallons sold.
The SSFA said that a BP proposed settlement raises the following concerns, among others: The Retalix system "is still malfunctioning," SSFA claimed. The BP proposal requires franchisees to continue using the Retalix system. BP offers a discount to the cost of the Retalix system, but only if a franchisee continues to use the Retalix system for the next five years, and remains a franchisee with BP-ARCO for that period. The price of the Retalix system "appears to be unreasonably high." Franchisees will be required to release and waive all claims, known and unknown, related to losses that have been sustained concerning the Retalix system and will be prohibited from asserting future claims Franchisees are being required to waive any right to recover losses or damages in the future. Given the recent announcement that BP will be divesting itself of ARCO, franchisees will be dealing with another company. When contacted by CSP Daily News, BP said that it had "no comment on this pending litigation." Retalix did not respond to a request for comment on this story by press time.
Russ Scaramella, a principal with Arizona Oil Holdings--a BP jobber for more than a decade and one of the largest ampm franchisee in the United States, with 65 locations in Arizona, Georgia and Florida--offered his take on the situation to CSP Daily News. He said that he was in on many of the original discussions by some of the parties in this suit.
He said that he is not signing onto the suit; he is "disappointed to see it filed [and does not] believe there is any merit to it."
In Scaramella's opinion, the case it is "not about fixing a [POS] system." The suit was filed because ARCO is being sold, he believed. Some "renegade franchisees...have teamed up and believe that by filing the lawsuit, they can extort money out of the company to make it go away," he alleged.
He said that many franchisees have not joined the suit, despite what Scaramella described as "bullying behind the scenes." Many of the signatories were "harassed into signing on," he said. He confirmed reports that the number of franchisees joining the suit or constituting the potential class is not what was expected by the plaintiffs. (CSP Daily News could not confirm a number by press time.)
Scaramella said that he hopes that BP defends itself in this case. He also claimed that the SSFA did not approve emails in support of the suit that went out on its behalf. The emails "were not accurate, were not honest," he said, adding that he is "disappoint how some of the people have handled themselves."
Dallas-based Retalix is a leading provider of software solutions to retailers and distributors worldwide. The company's product and services help its customers automate and synchronize essential retail and supply chain operations, encompassing stores, headquarters and warehouses. Specializing in the food industry, Retalix serves customers in more than 50 countries.London-based BP, with U.S. headquarters in Warrenville, Ill., markets more than 15 billion gallons of gasoline every year to U.S. consumers through more than 10,000 BP and ARCO retail outlets and supplies more than four billion gallons of fuel annually to fleets, industrial users, auto and truck manufacturers, railroads and utilities. BP owns the ampm brand, based out of La Palma, Calif. The ampm brand was founded by ARCO in 1978.
The case is Green Desert Oil Group Inc. et al. v. BP West Coast Products LLC et al. (N.D. Cal case number CV-11-2087).
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