Amid historic gas prices across the country, several stations are taking drastic action against a competitor that is keeping prices significantly low.
According to local affiliate ABC News WISN, several competing gas stations in the Woodman Market area in Waukesh, Wisconsin, have filed a lawsuit against the establishment, alleging that it sells gasoline below cost. The locations claim that this is a violation of the Wisconsin Fraudulent Sales Act.
Court documents obtained by WISN list companies operating nearby BP and Shell gas stations as plaintiffs in the case. Both are seeking $80,000 in damages, an amount based on the 40 days they claim Woodman kept prices too low.
As of Saturday, the average price of a gallon of gasoline in Wisconsin was about $3.93, according to AAA data. Woodman’s currently offers gasoline for $3.59 a gallon, based on data obtained by Newsweek from GasBuddy. BP and Shell affiliates in Waukesha list prices of $3.89-$3.99 per gallon.
Gas stations in Waukesha, Wisconsin, are suing a competitor for allegedly illegally lowering gas prices. Above is a shot of a gas station in Wisconsin. Karen Blair/AFP via Getty Images
Woodman’s, for its part, defended its prices in light of the lawsuit. The station told WISN that its pricing will compete with Costco, six miles from Pewokee, which the station considers its main competitor. GasBuddy’s listings show Costco in the area selling gas for $3.49 a gallon. The company filed a counterclaim seeking dismissal.
“These allegations have no legal or factual basis,” lawyers Eric Meyer and Emily Logan Steadman wrote in a motion to dismiss, local newspaper The Freeman reported. “Firstly, Waukesha Woodman’s was selling gas above the legal price for two days. Second, on 38 other days, Waukesha Woodman’s legally set the price of regular unleaded fuel to match/attempt to match Pewukee Costco, which is one of Woodman’s competitors.
“As a result of the foregoing, Woodman’s is not covered by this claim and the court must grant Woodman’s motion for summary judgment and dismiss the gas station’s claims in their entirety.”
Woodman customers interviewed by WISN confirmed that they made sure to go to the station because of the lower prices. There were also long queues at the station on Friday, while others in the area had only a few customers at a time.
Membership retailers such as Costco and Sam’s Club can often charge much lower gas prices at their gas stations compared to standard gas stations in their area. According to Reader’s Digest, they may charge such a small fee because about 75% of their profits come from subscription fees.
Like Costco, Woodman’s is a regional grocery store chain that offers local gas, but it’s not just memberships.
Newsweek has reached out to Woodman’s attorneys for comment on the story.