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Hawaii, oil companies settle for $20 million
by The Associated Press
The state of Hawaii and five oil companies have completed their agreement to settle the state’s price-fixing lawsuit.
Hawaii Gov. Ben Cayetano said the settlement will be worth $20 million to the state. That is about 1 percent of the $2 billion the state had sought, but it ends litigation that has cost the state hundreds of thousands of dollars in legal bills.
The agreement was expected to be signed and filed with the court March 5 or 6. A tentative settlement was announced on Jan. 16 by federal mediator Clyde Matsui.
Jeffrey Ono, an attorney representing the state, said the oil companies will not be required to admit any wrongdoing or make any concessions to the state other than the financial payment.
The settlement involves Chevron Corp., Shell Oil Co., Texaco Inc., Tosco Corp. and Unocal Corp. BHP Hawaii and Tesoro Petroleum Corp. settled with the state in 2000 and agreed to pay a total of $15 million. Governor disappointed Cayetano said he is disappointed that the state settled because he believes the state’s evidence could have prevailed in a jury trial. To take the case before a jury, the state would have had to go before the U.S. 9th Circuit Court of Appeals, and Cayetano said that might have been difficult because the court has become more conservative.
After payment of about $12 million in legal fees, the state will get about $23 million from the two settlements. Cayetano said he wants to put the money into the state’s highway fund where it could be used to offset any future gasoline tax increases.
The 1998 lawsuit accused the oil companies of fixing gas prices and allocating market share among themselves as early as 1987. The companies kept gasoline prices in Hawaii artificially high through a complex scheme of “product exchange” agreements with one another while forcing competitors to pay higher rates for the same gasoline.
At the time the lawsuit was filed, Hawaii had the highest gasoline prices in the nation.
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