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Gas Collusion Suit Reinstated


A San Diego County Superior Court judge who had thrown out a gasoline price-fixing lawsuit against nine major oil companies has changed his mind and granted a motion for a new trial on the consumer class-action complaint.

The lawsuit, originally filed in June 1996, contended that the oil refiners worked together to increase the price of reformulated, cleaner-burning gasoline by restricting supply.

The refiners, which have been required by the California Air Resources Board to produce the gasoline since March 1996, said the generally higher prices have been the result of market forces.

Judge David Danielsen on Friday entered an order that vacates his Oct. 17 order in which he found that the plaintiffs in the class action (Aguilar et al. vs. Arco et al.) had provided only circumstantial evidence that was "insufficient to suggest an agreement in restraint of trade" by the defendant refiners.

In the latest order granting a new trial, Danielsen said the defendants were required but failed to offer evidence showing that inter-company agreements to exchange oil and gasoline did not have the potential--perhaps unintended--effect of fixing prices or eliminating competitors, which also would violate antitrust laws.

"We're back in the saddle and heading for a jury trial," said plaintiffs' lawyer Timothy Cohelan.

The defendants are Atlantic Richfield Co., Chevron Corp., Exxon Corp., Mobil Oil Corp., Shell Oil Co., Texaco Inc., Tosco Corp., Ultramar Corp. and Unocal Corp.

Los Angeles-based Arco, in a statement, expressed disappointment over the order but noted that "the decision only means that the judge now feels that there may be a factual issue requiring a trial. We believe that the court decided correctly last October when it found no evidence of a conspiracy to raise or restrict gasoline supplies."

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