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SB 610: Small Step Forward for Big Changes

Good NEWS from California Senate

SB 610 Fair Franchisee Bill passed via a 5 to 2 vote yesterday at Senate Judiciary Committee! It is now headed to the Senate floor for full Senate vote, then back to the Assembly, then hopefully to Jerry Brown this fall for signature. All of the Democrats supported the bill, the two GOP members voted no.
The bill’s author, Sen. Hanna Beth Jackson spoke and advocated for us extremely well…all of our franchisee, including Ali Mazarei, Keith Miller, Amin Salkhi, Quizino’s franchisees, McDonalds franchisees, political consultant and attorney expert testifiers did great, spoke very well as well. The IFA response (only one speaker) was muted at best. They felt they were going to lose today and they did.

We are very grateful for our team effort and the victory that resulted. BUT, this is one step and many more are needed before this legislative session concludes and we get signed CA legislation that improves franchise business conditions.

Please continue to send in support letters for both the Assmbly Bill AB1141 and SB 610 to your local Assemblyman and senator’s office.  We need all of your support.


Dear fellow franchisees,

As many of you are aware there has been a Credit Card MASTER CARD & VISA Settlement Agreement in access of $6+ Billion Dollars.  Do not believe the hype, the settlement DOES NOT PROTECT US IN ANY WAY SHAPE OR FORM. In fact, you will be giving up your rights under the settlement agreement and more price increase will follow.



PLEASE USE THE FOLLOWING LINK AND  Complete the fields below to opt-out and object

Every business of any kind that has accepted a credit or debit for payment since January 1, 2004 is a member of the class of plaintiffs in this antitrust case. It doesn’t matter if you have or have not received an official notice about the settlement – if you accepted cards for payment at any time since January 1, 2004 you are part of the class. If you do nothing, the court will assume you approve of the settlement.


…your opposition to the settlement in the strongest way possible.


…your right to pursue your own suit for past money damages.


…your business with the best protection from any argument that you have accepted the Settlement’s release terms.


Legal Update

As some of you have already heard, we scored a huge victory against BP in court yesterday, when Judge Berle denied their motion for summary judgment. Judge Berle based his decision on the fact that BP had failed to bring a motion that would dispose of the entire gasoline and Pay-point claims.

The gasoline claim, which we know is critically important to all dealers, seeks monetary compensation for BP’s violation of the gas contract, whereby it overcharges its own franchisees for gasoline; at the same time, BP sells gasoline to its own competitors at much cheaper prices. Also at issue in the gasoline claim, is BP’s practice of retaliating against franchisees that do not operate at BP’s desired margin. No matter how BP tries to spin this loss, it is a significant loss for them.

Now that the motion has been denied, the cases will be proceeding towards a jury trial, and Judge Berle has authorized plaintiffs to seek from BP its internal documents and information about the issues discussed above, marketing, advertising, debit card fees, as well as BP’s dealings with 3rd party vendors and the problems with the Retalix system. We will be seeking this information from BP very soon.

It is anticipated that in the future, BP will file additional motions to have the case thrown out, which we will vigorously oppose. We believe strongly in the gasoline claims and intend to place the full resources of all team of law firms to prosecute this and all other claims against BP.

For franchisees that you know who have been waiting on the sidelines to determine whether to join this lawsuit, now is the time for them to join.  Further delay by them may affect the value of and their ability to recover damages.

Because we are now heading toward a jury  trials, we are going to be contacting you very soon to obtain critical information regarding your various claims.


California Small Business Investment Protection Act

In 2012, Assemblyman Jared Huffman introduced AB 2305, “The Level the Playing Field for Small Business Act of 2012” to remedy the situation and level the playing field for franchisees. It passed one Assembly committee and fell only one vote short in the second. Our The effort is ongoing in 2013. (Read More)


Tesoro Buys BP Refinery, Arco Stations and Leases AMPM Operations

BP is selling its Carson refinery, inventory and its marketing agreements with 800 dealer-operated Arco gas stations in California, Arizona and Nevada to Texas-based Tesoro Corp. for $2.5 billion, the two companies announced Monday.

The deal is expected to close before the middle of next year.

There are 100 Arco-branded stations in Orange County. BP will retain ownership of the ampm convenience store brand and franchise it to Tesoro in the Southwest. It was not immediately known what the deal will mean for gasoline prices for Southern California consumers.

The purchase will make Tesoro, which owns an adjacent refinery in Wilmington, the biggest oil refiner on the West Coast.

When the deal is completed, the combined Southern California refineries will process 363,000 barrels of oil per day. Tesoro also owns six other refineries, mostly in the West, including one in Martinez in northern California. (read more)

Are We Really Making Money?

Mr. Bill Fry Court testimony 12-21-2011 “ As early as 2002 or 2003 AS the year 2005 drew to a close, BP faced an ugly reality. It had a number of company owned/company operated (“COCO” gas stations in the Chicago area and BP pegged it losses at over $100 million per year.

MR. Bill Fry Court testimony 12-21-2011 : as early as 2002 or 2003 BP concluded that a franchisee making 11CPG from DTW to retail price would suffer a negative investment return.”   So BP set out to “improve” the performance of these stations through projects such as Accelerator and Mustang.  These allowed it to grow the fuel volumes and c-store sales in its “core” BP sites at two to three times the NACS Industry averages.  But this growth in volume was realized the only way it could have been; by destroying BP’S profit margin.  “Trading volume for unit margin.”  Despite the increases in the volume of gas sold and gross-c-store sales, BP’s COCO sites were still generating negative return.

Vote No on Prop 29

On June 5, you can help defeat Prop 29 by voting NO. If passed, Prop 29 would increase the state’s cigarette excise tax by an additional $1.00 per pack and nearly double the tax on cigars and smokeless tobacco!

Retailers across the state have joined together to oppose Prop 29 and we appreciate your support.

But now is not the time to rest. Please continue to display the “NO on 29” campaign materials PROMINENTLY in your stores through June 5, 2012. If you have any remaining tear pad sheets, please hand them to adult tobacco customers.





AB 2305 ‘Level the Playing Field Act’ 2012 (Download letter here)

AB 2305 (pdf) would significantly revise  California’s existing Franchise Relations Act and its Franchise Investment Law.  If passed, franchisee advocates say it would provide strong protection for  franchisees that include the following:

  • It provides 60 days rather than the current 5 for franchisees in settling  their overdue fees.
  • Franchisee agreements would automatically be renewed under the original  terms unless the franchisee had substantially and materially breached the  contract, or if the franchisee elects, under the franchise terms then being  offered to new franchisees.
  • Franchisees would be given protection if the franchisor decided to set up a  new store in the old franchise’s backyard
  • Franchisors would owe a duty of competence to franchisees.
  • The parties to a franchise agreement would be required to deal with each  other in good faith.
  • Any provision in a franchise agreement requiring the application of the law  of another state would be void
  • It would be unlawful for a franchisor to refuse to recognize an independent  association of its franchisees.

(read more…)

ARCO Corrects Inaccurate Reports About Southern California Retail Closures

BP today corrected a number of inaccurate reports that the ARCO brand would be withdrawn from Southern California. BP remains committed to the ARCO and ampm convenience store brands.

BP announced plans to divest its Carson, California refinery and Southern California retail network in February 2011. (read more)

California Sues Oil Giant BP Over Shipments of Dirty Gasoline

WALNUT CREEK – Tens of millions of gallons of gasoline that did not meet California’s clean fuel specifications were delivered to the city of Martinez and sold across the state by petroleum giant BP, state regulators said in a lawsuit filed Wednesday.

The company submitted documents over a four-month period to regulators that said gasoline refined in Washington and shipped to Contra Costa County contained permissible levels of toxic and cancer-causing compounds, including benzene, when in fact the fuel failed to meet state standards, the lawsuit says. (read more)

BP Faces Class Action Over Expired Car Wash Codes

The complaint alleges certificates redeemable for pre-paid goods and services should be valid for five years from the date of purchase.

MINNEAPOLIS – BP America Inc. is facing a class action lawsuit in U.S. District Court, with the plaintiff claiming a station had sold her a car wash access code with an illegally short access code, CBS Minnesota reports. (read more)


Big Victory Regarding BP’s Improper Communications with Franchisees!!!

The Class Action Lawsuit filed a motion asking the Court to monitor BP’s settlement communications with all franchisees based on the believes (1) BP’s improper efforts to force franchisees to settle out and; (2) BP’s continued retaliatory conduct against the franchisees after they filed the lawsuit. The attorneys told the Court that BP could not be trusted in its dealings with the franchisees. (read more)


Arco Accepts Credit Cards Again

In major about-face, Arco will start accepting credit cards again at stations after 30 years of abstinence.

Arco is taking credit cards again. The move comes almost 30 years after the refiner “blew up” its credit card in TV commercials and slashed prices, ushering in a new era of competition at the pump. (read more)