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Supreme Court Upholds Hawaii's Gas Station Rent Cap

WASHINGTON -- The Supreme Court ruled Monday that Hawaii did not overstep its authority when it imposed caps on the rent paid by dealer-run stations.

According to a report on, the decision means that state legislatures preserve their authority to set local economic regulations without extensive second-guessing by federal courts.

The unanimous decision was a defeat for San Ramon, Calif.-based Chevron Corp., which argued that Hawaii's law was an unconstitutional "taking" of private property.

Justice Sandra Day O'Connor wrote that ruling otherwise would "require courts to scrutinize the efficacy of a vast array of state and federal regulations -- a task for which courts are not well suited."

Hawaii, which has some of the nation's highest gasoline prices, passed the law in 1997 to protect independent dealers and promote competition.

It restricted lease prices that oil companies could charge their dealer-owned stations and barred the companies from taking over those stations.

"If this case had gone the other way, we are certain that many constitutional challenges would have been filed, not just on the gas-cap legislation, but many pieces of economic legislation, land-use regulation, laws benefiting the environment," attorney general Mark Bennett said.

Bennett said as long as a state regulation of business makes sense, it is constitutional. Officials said the ruling could also make it easier for Hawaii to regulate prices at the pump.

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