Attorney General Jackley Announces Settlement Agreement with 85-Octane Wholesalers

 

Monday, December 31, 2012

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PIERRE, S.D.- Attorney General Marty Jackley announced today that an agreement with Harms Oil and M.G. Oil has been reached in regards to the investigation into the labeling of 85-octane gas. Both Harms Oil and M.G. Oil fully cooperated throughout the investigation. While the investigation revealed that 85-octane had been distributed and sold contrary to administrative rule, it did not reveal any unusual profits or unusual profit margins during the relevant time period.

Harms Oil agreed to pay $25,000 to the South Dakota Department of Public Safety to recoup the cost of purchasing a Zeltex portable octane tester and the cost associated with the first year of use. Harms Oil has agreed to pay $3,500 to produce educational materials to be distributed to retail businesses. Harms Oil has also agreed to pay to the Office of the Attorney General $21,500.00, which the Attorney General intends to turnover to the State’s general fund.

M.G. Oil has agreed to pay $25,000 to South Dakota Department of Public Safety to recoup the cost of purchasing a Zeltex portable octane tester and the cost associated with the first year of use. M.G. Oil has also agreed to pay $3,500 to produce educational materials to be distributed to retail businesses.

"This settlement resolves the outstanding 85-octane sale issues between the State and these wholesalers, and establishes reasonable standards to protect consumers," said Jackley.

As part of the Settlement, Harms Oil and M.G. Oil have agreed to:

  • obey all state and federal laws and administrative rules regarding the labeling of gas at the retail level, including but not limited to the accurate labeling of the octane rating and presence and percentage of ethanol.
  •  obey all state and federal laws and administrative rules regarding the sale and delivery of 85 octane gas in the State of South Dakota.
  •  obey all state and federal laws and administrative rules regarding the certification of the fuel rating for each delivery made.

In addition, Harms Oil and M.G. Oil will provide quarterly statements verifying compliance with all terms of the consent judgment for two years. These compliance reports will confirm that these businesses have not delivered any 85-octane gas to retail locations to any area of South Dakota where the sale of 85-octane gas is not authorized and/or legal. Harms Oil and M.G. Oil will also collaborate with the State to prepare a brochure detailing the fuel pump labeling requirements that will be in effect after July 1, 2013, and will pay the cost to send the brochure to each gasoline retailer in the state.