Complaint Alleges Kwik Trip Offered Illegally Low Prices

Credit: Kwik Trip Facebook page
Credit: Kwik Trip Facebook page

One of the biggest supporters of Wisconsin’s minimum markup law has just been hit with a complaint alleging they have violated the Depression-era mandate. Kwik Trip, a fuel and convenience retail chain headquartered in La Crosse, Wisconsin, allegedly violated the 1939-enacted Unfair Sales Act by offering cigarettes at a price lower than that allowed by state law.

Kwik Trip has been an ardent supporter of the current law.

According to documents obtained from the Department of Trade, Agriculture and Consumer Protection – DATCP for short – on October 5, 2015 a lawyer for an undisclosed client filed a complaint against Kwik Trip claiming that the convenience chain was offering Pall Mall cigarettes at a below-cost price. The Unfair Sales Act prohibits retailers from selling goods below cost unless they are meeting a competitor’s price. A Kwik Trip mailing that accompanied the complaint advertised a carton of Pall Mall cigarettes for $61.61. The mailer was sent to a PO Box in Thorp, Wisconsin.

Milwaukee-area attorney Mark P. Murphy filed the complaint. His professional Facebook page lists him as a general practice attorney.

The complaint asks DATCP to, “[p]lease commence the proper action on behalf of the state in accordance with Wisconsin Statute 100.30(40).” DATCP is tasked with investigating violations of the minimum markup law and issuing fines to retailers who try to offer illegal savings or illegally low prices to consumers.

Kwik Trip has so far been an ardent supporter of the law, arguing that its price-fixing formula allows retailers like them to stay in business. During the 2005 legislative session, for example, Kwik Trip paid lobbyists to oppose a pair of bills that would have repealed the law. In a February 2006 letter to lawmakers, Kwik Trip declared:

“Kwik Trip, Inc. is a family-owned business based out of La Crosse, Wisconsin. Our company operates over 350 convenience stores in Wisconsin, Minnesota and Iowa and employs over 7,000 individuals. Kwik Trip, Inc. strongly supports current law as it relates to the Unfair Sales Act.”

Oddly, in 2003 a Kwik Trip representative told a legislative committee that while “Kwik Trip supports the minimum mark-up law,” the company was opposed to a change in the law that would prevent their gas stations located near state borders from lowering prices below the Wisconsin-mandated floor so they can meet competition from stations in Iowa, Illinois and Minnesota.

From 2000 to 2005, Kwik Trip carried on a legal fight with Woodman’s Market, a discount grocery chain that also owns a few cash-only gas stations, in which both companies tried to use the minimum markup law to stifle a competitor.

Woodman’s used to be opposed to the law, but recently used it to file a complaint against a new competitor that moved into Wisconsin.

State Sen. Leah Vukmir (R) and state Rep. Jim Ott (R) have both said they are going to push legislation to repeal the Unfair Sales Act sometime this session. The Federal Trade Commission has twice reviewed the law and declared it to not be in the best interest of consumers. It remains to be seen if Kwik Trip and other previous supporters of the law will emerge as opponents of consumer oriented reforms.

Kwik Trip’s position on the Unfair Sales Act:

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Complaint against Kwik Trip:

Complaint #10285