Calfee Company Wins Verdict in Petroleum Lawsuit

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Calfee Company Wins Verdict in Petroleum Lawsuit

DALTON, Ga. -- A north Georgia jury issued a verdict in favor of the Calfee Company of Dalton Inc., finding that BP violated the Petroleum Marketing Practices Act by wrongfully terminating or failing to renew Calfee’s franchise following the BP-Amoco merger.

In recent years, many of the major oil companies have combined and consolidated, effectively limiting the bargaining power of local retail franchisees. The Georgia jury verdict serves as a strong reminder to these oil companies of the PMPA’s protection against the arbitrary or discriminatory termination or non-renewal of franchisees.

"Just because big oil companies tell you something, does not mean it’s true," Joe Turner, president of Calfee Company, told CS News Online . "This lawsuit sets a good example for jobbers to realize that maybe they do not owe what big oil companies claim they do. I would tell them to not blindly believe what oil companies claim and get an attorney. They have the ability to fight it."

BP Products North America Inc., formerly Amoco Oil Co., unilaterally ended its franchise relationship with Calfee in 2001. BP then filed suit in the United States District Court for the Northern District of Georgia, Rome Division, claiming that Calfee owed it $1 million on 26 incentive contracts that it entered into with Amoco in the mid-1990s. Calfee defended against BP’s claim on the grounds that Calfee was always in compliance with its branding commitment and that BP -- not Calfee--caused the franchise relationship to end. Calfee filed a counterclaim under the PMPA.

The jury concluded that Calfee does not owe the money claimed by BP under any of the incentive contracts. In addition, finding that BP violated the PMPA, the jury awarded Calfee $500,000 in damages, plus prejudgment interest. Under that federal statute, Calfee will recover its attorneys fees, as well. Calfee is also requesting that the court enter an award of exemplary damages, as allowed under the PMPA.

Dalton, Ga.-based Calfee Company of Dalton Inc. operates 130 Favorite Markets and Com-Pac Food Stores in Tennessee, Georgia and Alabama.