In a victory for the plaintiffs of a class-action lawsuit against the propane business DeCarli’s, a Marin County Superior Court judge ruled on Tuesday that catch-up bills sent last year by the business violated a 2011 settlement agreement that ensured customers’ access to timely and accurate substantiations of all charges.
In a decision that could affect thousands of customers, the judge barred DeCarli’s from collecting on all bills for charges, including tank rental fees, incurred before May 2012, a date based on the four-year statute of limitations.
He also ordered that the company issue comprehensive new billing statements for charges between May 1, 2012 and May 31, 2016 to around 2,000 former and current customers who received catch-up bills, referred to as “balance forward” bills. DeCarli’s must also refund any amounts paid in response to balance forward bills sent late last spring.
Though customers should be promptly informed about the ruling, the process of calculating revised bills and refunds may take time. The court ordered the parties to provide a status report by September.
The decision concludes an extensive legal battle between the Petaluma company and three customers—Susan Deixler, Scott Yancy and Luigi Venezia—that began in 2009 with a class-action suit over how DeCarli’s priced propane. The plaintiffs had alleged that the business used an inaccurate conversion factor when measuring the amount of propane used, leading to overcharges, and failed to bill in a timely and accurate manner.
Under a court-approved settlement agreement in 2011, 84 customers were paid a total of more than $34,000 as reimbursement for overcharges.
The 2011 settlement also listed a number of provisions for DeCarli’s to follow, including that it would “become current in providing invoices and billing statements to its customers” soon after the settlement was finalized, and that bills would come with “all documentation required for the customer to substantiate new charges.”
Per the settlement, being current means sending bills to metered customers within 45 days of when charges were incurred.
In May and June 2016, the company issued a new round of billing statements demanding its customers pay a balance forward that included charges up to eight years old, without a detailed explanation or breakdown of the charges.
The plaintiffs in the class-action suit filed a new motion that September, claiming the mailings violated the agreement.
Last December, Judge Geoffrey Howard ruled in favor of the plaintiffs. He also ordered a small-scale accounting audit of 30 of the company’s customers to better assess the plaintiffs’ claims.
This past spring, the auditor, Novato C.P.A. Kenneth Frank, said that the billing statements were accurate.
But on Tuesday, Judge Stephen Freccero said the invoices included charges that did not specify the time period covered by the balance forward amounts. This did not comply with the settlement agreement, he said.
“Customers need to receive something they understand. And if they have a dispute, they ought to be able… to reasonably figure out if they can contest it,” he said.
Judge Freccero favored a suggestion proposed by the plaintiffs’ lawyers that barred DeCarli’s from collecting charges specified in last year’s catch-up bills that were incurred prior to May 2012. He also prevented DeCarli’s from collecting tank rental fees prior to May 1, 2012 due to the company’s inability to provide effective notice of those charges to its customers.
Finally, the judge ordered the company to issue new and detailed billing statements for all its customers for the period between May 1, 2012 and May 31, 2016, ideally by September. Though lawyers for DeCarli’s told the judge that the audit of 30 customers took DeCarli’s employees more than 850 hours of time to complete, they said they were “optimistic” that the company would be able to complete the new round of billing by the September status report deadline.
Attorney Joren Ayala-Bass said DeCarli’s is considering hiring a software vendor to write a code that could assist in writing the billing statements.
Decarli’s did not return calls requesting comment by press time.
Updates to the case will be posted at chavezgertler.com/current-cases/yancy-v-decarli/.