KY's Attorney General accuses Marathon of price gouging

FRANKFORT, KY (FOX19) - Kentucky's Attorney General has accused Marathon stations of price gouging, as prices continue to hover around the $4 mark.

A Kentucky judge wants to hear more testimony before deciding whether Marathon Petroleum Company illegally jacked-up gas prices in the state during a time of emergency.

Attorney General Jack Conway alleges that Marathon violated an emergency order issued by Governor Steve Beshear late last month, after heavy rain caused major flooding.

The state of emergency prohibits price gouging during disasters, but Marathon claims Conway is only arguing this now, because Tuesday is Election Day and Conway is running in the Democratic Primary for Attorney General.

However, Conway is running unopposed.

Experts are expected to testify at a hearing Thursday morning. We have reaction from the Kentucky Attorney General's Office and a local lawmakers.

This fight, however, is not a new one. Greg Stumbo, who is now the House Speaker, actually started lobbying for the anti-price gouging law when he was Attorney General.

Now Conway has picked up the torch and said Marathon should not have raised its rates during a declared state of emergency.

Was Marathon's super-fast price hike market-driven?

"Or was it greed?," asked Kentucky State Senator Arnold Simpson (HD-65). He and others would like to know.

"I feel it was totally uncalled for," said Louisville businessman Jeff Banks in disgust, whom we caught up with filling his tank at a Marathon. "I can't see a justification."

Marathon's gas prices went through the roof after Governor Steve Beshear had declared a state of emergency, in the wake of storms and flooding, in western, southern and northern Kentucky.

"This action has been filed for quite some time," Simpson said and that this latest move is really a continuation, to get anti-price gouging legislation passed.

"So, this is a motion in an existing case against Marathon," he explained.

"Big oil companies have lots of lawyers and they're going to fight us," said Allison Martin with the Attorney General's Office. "But the Commonwealth of Kentucky has one lawyer and that's Jack Conway and he is going to pursue this on behalf of consumers."

Friday, Conway's office filed a motion accusing wholesale gasoline supplier Marathon Oil of price gouging, raising prices during a state of emergency for something other than Marathon's costs.

"We believe that that price may have been based on something else," Martin said. "Such as future markets, things like that. they can do that, but not during a declared state of emergency when the price gouging statute has been triggered."

There are a handful of independently-owned Marathon gas stations in northern Kentucky. We called all of them, but none of their managers wanted to speak with us on camera. We also checked with a number of Speedway stations in the area. Speedway is actually owned by Marathon, but their managers also said they're under strict orders not to talk to the media.

"It's kind of odd the price would jump up so rapidly," Simpson said. "So quickly after the natural disaster and that's what the litigation is really about. Someone's making a lot of money off working Americans and it's not fair."

"You know, it may be a matter of cents, really," Martin said. "But when you're talking about 4 million people in the Commonwealth of Kentucky who are paying two or three cents more a gallon, that's a lot of money."

The Attorney General's Office wants a Judge to force Marathon to re-set its gas prices to what they were, the day before Kentucky went into its flooding state of emergency.

The case is back in court Thursday in Frankfort.

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