Facts

The People of the State of California sued Ferrelgas Partners LP, Ferrelgas LP, Amerigas Propane Inc., and Amerigas Propane LP, alleging anticompetitive, unfair, fraudulent, and unlawful business practices in violation of California's Business and Professions Code.

Defendants do business in the state under the names Blue Rhino, and AmeriGas Cylinder Exchange. Defendants were wholesale sellers of pre-charged propane tanks to California retailers. Consumers used these pre-charged tanks to fuel barbecue grills, outdoor heaters and other household usages.

PLAINTIFF'S CONTENTIONS:
Defendants made statements that their propane tanks were filled to reasonable capacity or "full" when they were in fact not full. Plaintiff contended the defendants had reduced the contents of the tanks to approximately 15 pounds, which were neither full nor filled to reasonable capacity. Plaintiffs claimed defendants made false or misleading advertising statements in violation of the law, and also engaged in unlawful, unfair, and fraudulent acts as well as omissions and practices that constituted unfair competition within the meaning of the law.

DEFENDANTS' CONTENTIONS:
Defendants argued that they have maintained, throughout the four-year investigation, that the net weight of each propane tank was displayed prominently on the tank as well as on the cages from which the tanks were sold by retailers, in compliance with both California and federal law. Defendants contended that to resolve the matter without further delay and expense, they agreed to provide consumers with additional disclosures at the point of sale.

Result

Without admitting or denying any liability, defendants agreed to stop making any statement known or reasonably known to be untrue or misleading regarding the weight or volume of propane contained in its tanks. Ferrelgas also agreed to pay $1 million in civil penalties. Amerigas agreed to pay $800,000 in civil penalties.