The Second Appellate District affirmed in part and reversed in part a judgment and remanded. The court held that the judicial abstention doctrine was not shown to apply to consumer claims against an oil company arising from the company’s failure to disclose to consumers the effects of temperature change on the volume of retail motor fuel.
Allen Klein and others filed a class action complaint against defendant and respondent Chevron U.S.A., Inc. asserting claims for violations of the Unfair Competition Law (UCL) and Consumers Legal Remedies Act (CLRA), breach of contract and unjust enrichment. The plaintiffs’ claims were predicated on Chevron’s practice of purchasing wholesale motor fuel in gallon units at a standardized temperature of 60 degrees Fahrenheit and reselling it to California consumers at an average temperature of approximately 70 degrees. They argued that, because motor fuel expands as it is heated, Chevron’s failure to compensate for temperature increases in retail motor fuel, or to disclose the effects of such increases, harmed consumers in several ways. First, consumers received less motor fuel – measured by mass and energy – than they would have received if Chevron adjusted for temperature increases. Second, consumers were led to believe that each gallon of motor fuel contained a standardized amount of energy, when, in fact, the energy content varied depending on temperature. Third, consumers were unable to determine the actual price of motor fuel or to compare prices between retailers. Fourth, as a result of this practice, Chevron was able to collect and retain more motor fuel taxes from consumers than it was required to pay to the government.
