Published: February 26, 2008 11:00 pm      

Customers say gas company's overcharging

GRAYLING -- Lawrence Friedman sued Gaylord Gas for allegedly violating the Michigan Consumer Protection Act by grossly overcharging customers for propane this winter.

Friedman, an attorney and part-time resident of Frederic in Crawford County, filed a class action lawsuit against Gaylord Gas and its parent company, Inergy Propane of Kansas City, Mo., after he was charged $3.49 per gallon in January, more than $1 above the state average, he said.

More than 100 people called Friedman with similar stories of alleged price gouging after he filed suit this month.

"I thought they were just taking advantage of me, or out-of-town folks, but clearly not," he said.

Friedman contends the company violates consumer protection laws by charging well above market prices for propane and not bothering to notify customers until they get a bill. Any price objections bring the sole option to choose another supplier, pay to have the already-delivered propane pumped back out of the tank and then have the tank removed.

Jack Alexander of Gaylord, another Gaylord Gas customer, recently paid 20 cents more per gallon than Friedman.

"I personally feel I was overcharged. It was way higher than it ever was before," he said.

When he called the company to complain, he was told he was lucky because the price was going up another 20 cents overnight, Alexander said.

Company officials in Gaylord did not return calls for comment and Debbie Hagen, spokeswoman for Inergy, declined to comment.

Judge Janet Allen of the 46th Circuit Trial Court in Grayling heard testimony on Monday afternoon about the complaint. The hearing was expected to continue Thursday.

Friedman argued that the company traps customers into facing either inflated prices or excessive fees to change providers in what he described as an "illegal scheme and deceptive practices."

Witnesses included unhappy customers and the owner of a competing propane company.

Gaylord attorney Richard Bensinger appeared in court to represent Gaylord Gas, which he said was willing to let Friedman out of his contract without fees, but Friedman argued the same offer should be made to every customer and excessive rates should be halted by the court.

The Michigan Attorney General's Office investigates all reported instances of price gouging, said agency spokesman Matt Frendewey, but he declined to say whether this case was under review.