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Minnesota settles suit with Ferrellgas over propane prices and fees

Minnesota Attorney General Lori Swanson has settled a lawsuit with Ferrellgas, L.P., a large national propane energy company, requiring Ferrellgas to change its business practices and recovering money for Minnesota consumers who paid undisclosed charges or fees.

The state's suit alleged that Ferrellgas didn't always disclose specific per-gallon prices to consumers who called to fill their tanks. The lawsuit further alleged that despite telling its customers that it would charge "competitive propane prices," or "our current market price," it sometimes charged rates that were significantly higher than those of its competitors.

Ferrellgas also charged undisclosed and poorly disclosed fees, including "low usage" and "no usage" fees of up to $199 for consumers who in the company's judgment did not use enough propane.

The settlement requires Ferrellgas to disclose the price it will charge consumers at the time of a consumer's order. The settlement also requires clear and conspicuous fee disclosures. In addition, under the settlement, Ferrellgas must directly refund all no-use and low-use fees charged to Minnesotans.

"For many people, propane is a costly necessity to heat their homes. Propane pricing should be transparent so that consumers can make informed choices about their purchases," Swanson said.

The settlement requires Ferrellgas to pay $450,000 to the state. The Attorney General's Office will create a settlement fund, from which it will compensate Ferrellgas customers who make a valid claim that they paid undisclosed charges or fees. The settlement was approved by Ramsey County District Court Judge John B. Van de North.

If consumers would like to participate in the settlement fund or have questions, they should contact the Attorney General's Office at 651-296-3353 or 800-657-3787.