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Yahoo
4 days ago
- Business
- Yahoo
Did insurers collude to force homeowners onto state insurance plan? What to know from two blockbuster lawsuits
The firestorms that swept through Pacific Palisades, Altadena and other communities Jan. 7 not only devastated thousands of homeowners but highlighted a giant problem: the growth of the state's insurer of last resort. The California FAIR Plan Assn. offers policies that cover less, but typically are expensive. Now, California home insurers are facing twin lawsuits filed by homeowners who accuse them of colluding over the last several years to force them into the plan in order to profit from the higher premiums while reducing their liabilities in the event of a catastrophe — just what the lawsuits allege happened after the fires. The result, according to one suit, is the insurers "collectively reaped a windfall worth billions of dollars." The Times spoke to both sides, as well as multiple experts to better understand the high-stakes litigation, which faces obstacles but could shake up California's home insurance industry. Who is being sued and exactly what do the lawsuits allege? The Los Angeles County Superior Court suits filed last month name more than 200 insurers and affiliates as defendants, including State Farm, Farmers and Mercury that account for about three quarters of the state's property and casualty insurance sales. The lawsuits accuse them of unfair competition and violations of the Cartwright Act, a state law that prohibits agreements to restrain trade, fix prices or reduce competition. The homeowners assert the insurers engaged in a "group boycott" to terminate policies in Pacific Palisades, Malibu, Altadena and other fire-prone neighborhoods in early 2023 and then refused to write new policies. That left the homeowners with no choice but to join the FAIR Plan, where they paid more but the policies are limited, including through a $3-million coverage cap on dwellings. Read more: Insurers seek to surcharge California homeowners for L.A. County fire costs How would the insurers benefit from such a scheme? The FAIR Plan was established by the Legislature in 1968 but is operated by the state's licensed home insurers that share in its profits and losses. By moving homeowners onto the plan, the insurers would profit from higher premiums, while being exposed to fewer losses due to its limited policies. The result was an effective rate increase without the insurers having to undergo a state review, the lawsuits allege. Why are there two lawsuits? One lawsuit is a proposed class action and seeks to have policyholders compensated for the alleged higher premiums they paid. The other seeks to compensate homeowners who experienced losses during the fires and then suffered further due to their alleged inadequate FAIR Plan coverage. Each lawsuit seeks treble damages. What do the lawsuits cite as evidence of collusion? The litigation claims that the collusion and boycott were carried out through meetings of the FAIR Plan's governing committee and subcommittees, as well as weekly meetings of the Personal Insurance Federation of California and the American Property Casualty Insurance Assn., or APCIA, two leading trade groups, among other mechanisms. However, the lawsuits do not offer any written documentation from these meetings. The lawsuits also note that last year, insurers won the right from Insurance Commissioner Ricardo Lara to surcharge their own residential and commercial policyholders if the FAIR Plan runs out of money — which it has since the fires. One of the lawsuits cites the new policy as evidence of the insurers' "determination to act collusively." APCIA issued a statement saying that it has a legal right to voice industry concerns to the government and that it "complies with all applicable antitrust laws." Read more: Palisades fire victims seek court order forcing FAIR Plan to turn over claims documents So how can the allegations be proved in court? Stephen Larson, a former federal judge whose firm Larson is one of the two representing the plaintiffs, said that the discovery process will be key. "We did a tremendous amount of due diligence prior to bringing this lawsuit, and we anticipate there will be requests for documents, there will be interrogatories [written questions answered under oath] and there will be depositions. We're going to be have the opportunity to depose those that we believe are responsible for this." What do insurers say about all this? Rex Frazier, president of the Personal Insurance Federation, said there was nothing collusive about insurers' behavior. Instead, it was a logical consequence of being unable to get adequate rate increases as costs and wildfire danger have increased. "What business, whether the insurance industry or any other business, can survive a highly inflationary cost structure without the ability to raise its prices? We've been predicting why the FAIR Plan will grow — we're not allowed to have meetings we've held for 30 years?" he said. Read more: Insurer of last resort kept growing. Then L.A. fire victims paid the price Will it be difficult to prove collusion? Yes, it will be a tall order, legal experts say. Donald Pepperman, a partner at Waymaker in Los Angeles who specializes in antitrust litigation, said a key defense probably will be that the insurers acted in their own economic self interest in dropping policyholders. "Why should they be forced to stay in a market that's not profitable when there are other markets in California where there's less disasters?" he asked, adding that without more evidence of collusion the lawsuit may not get far — and finding that will be difficult. "I don't know that they're going to be that unsophisticated, that in the FAIR Plan minutes of a meeting they're going to admit they conspired to pull out of markets or fixed prices." Tom Baker, a professor who specializes in insurance at the University of Pennsylvania's Penn Carey Law school, said the plaintiffs will need to show that they somehow acted in a more "extreme" manner than was supported by their actuarial data, which he agreed will be challenging — though he said the discovery process is a powerful tool. "The bright side of this lawsuit is that we're gonna get some information, but count me skeptical about whether they're gonna succeed, unless they can find some kind of smoking guns." Are there less nefarious reasons for insurers pulling back from the California market? Yes, there are alternative explanations. James Naughton, a former actuary and a professor at the University of Virginia's Darden School of Business, said that advances in data management have allowed insurers to collect more data than ever about the risks they face, with much of it the same across insurers. "What could appear to be collusion could also be companies just using the same data. If I'm an actuary at one company, it's not hard to be an actuary at another company. The information moves," he said. Naughton added that there also can be "soft collusion," a concept that refers to actors in a market trading information or having an understanding of their competitors' strategies, leading to similar decision-making. Read more: Consumer group sues insurance commissioner over Fair Plan assessments on state homeowners What do the plaintiff's attorneys say about all of this? "Do we expect to find a document from party A to party B, saying today we're going to have a meeting to discuss how we're going to collude with each other on avoiding risk and going to FAIR Plan agenda item? No, I don't expect we're going to find that," said Michael Bidart, with Shernoff Bidart Echeverria, the other plaintiffs' firm. "Rare is the case in any litigation where you have a document that provides the ultimate direct evidence." Instead, the attorneys said they will rely on accumulated evidence to show how the insurers allegedly conspired to drop policyholders in order to move them to the FAIR Plan for their own benefit. "So anything else we get on top of it is just icing on the cake," Bidart said. Sign up for our Wide Shot newsletter to get the latest entertainment business news, analysis and insights. This story originally appeared in Los Angeles Times.
Los Angeles Times
4 days ago
- Business
- Los Angeles Times
Did insurers collude to force homeowners onto state insurance plan? What to know from two blockbuster lawsuits
The firestorms that swept through Pacific Palisades, Altadena and other communities Jan. 7 not only devastated thousands of homeowners but highlighted a giant problem: the growth of the state's insurer of last resort. The California FAIR Plan Assn. offers policies that cover less, but typically are expensive. Now, California home insurers are facing twin lawsuits filed by homeowners who accuse them of colluding over the last several years to force them into the plan in order to profit from the higher premiums while reducing their liabilities in the event of a catastrophe — just what the lawsuits allege happened after the fires. The result, according to one suit, is the insurers 'collectively reaped a windfall worth billions of dollars.' The Times spoke to both sides, as well as multiple experts to better understand the high-stakes litigation, which faces obstacles but could shake up California's home insurance industry. Who is being sued and exactly what do the lawsuits allege? The Los Angeles County Superior Court suits filed last month name more than 200 insurers and affiliates as defendants, including State Farm, Farmers and Mercury that account for about three quarters of the state's property and casualty insurance sales. The lawsuits accuse them of unfair competition and violations of the Cartwright Act, a state law that prohibits agreements to restrain trade, fix prices or reduce competition. The homeowners assert the insurers engaged in a 'group boycott' to terminate policies in Pacific Palisades, Malibu, Altadena and other fire-prone neighborhoods in early 2023 and then refused to write new policies. That left the homeowners with no choice but to join the FAIR Plan, where they paid more but the policies are limited, including through a $3-million coverage cap on dwellings. How would the insurers benefit from such a scheme? The FAIR Plan was established by the Legislature in 1968 but is operated by the state's licensed home insurers that share in its profits and losses. By moving homeowners onto the plan, the insurers would profit from higher premiums, while being exposed to fewer losses due to its limited policies. The result was an effective rate increase without the insurers having to undergo a state review, the lawsuits allege. Why are there two lawsuits? One lawsuit is a proposed class action and seeks to have policyholders compensated for the alleged higher premiums they paid. The other seeks to compensate homeowners who experienced losses during the fires and then suffered further due to their alleged inadequate FAIR Plan coverage. Each lawsuit seeks treble damages. What do the lawsuits cite as evidence of collusion? The litigation claims that the collusion and boycott were carried out through meetings of the FAIR Plan's governing committee and subcommittees, as well as weekly meetings of the Personal Insurance Federation of California and the American Property Casualty Insurance Assn., or APCIA, two leading trade groups, among other mechanisms. However, the lawsuits do not offer any written documentation from these meetings. The lawsuits also note that last year, insurers won the right from Insurance Commissioner Ricardo Lara to surcharge their own residential and commercial policyholders if the FAIR Plan runs out of money — which it has since the fires. One of the lawsuits cites the new policy as evidence of the insurers' 'determination to act collusively.' APCIA issued a statement saying that it has a legal right to voice industry concerns to the government and that it 'complies with all applicable antitrust laws.' So how can the allegations be proved in court? Stephen Larson, a former federal judge whose firm Larson is one of the two representing the plaintiffs, said that the discovery process will be key. 'We did a tremendous amount of due diligence prior to bringing this lawsuit, and we anticipate there will be requests for documents, there will be interrogatories [written questions answered under oath] and there will be depositions. We're going to be have the opportunity to depose those that we believe are responsible for this.' What do insurers say about all this? Rex Frazier, president of the Personal Insurance Federation, said there was nothing collusive about insurers' behavior. Instead, it was a logical consequence of being unable to get adequate rate increases as costs and wildfire danger have increased. 'What business, whether the insurance industry or any other business, can survive a highly inflationary cost structure without the ability to raise its prices? We've been predicting why the FAIR Plan will grow — we're not allowed to have meetings we've held for 30 years?' he said. Will it be difficult to prove collusion? Yes, it will be a tall order, legal experts say. Donald Pepperman, a partner at Waymaker in Los Angeles who specializes in antitrust litigation, said a key defense probably will be that the insurers acted in their own economic self interest in dropping policyholders. 'Why should they be forced to stay in a market that's not profitable when there are other markets in California where there's less disasters?' he asked, adding that without more evidence of collusion the lawsuit may not get far — and finding that will be difficult. 'I don't know that they're going to be that unsophisticated, that in the FAIR Plan minutes of a meeting they're going to admit they conspired to pull out of markets or fixed prices.' Tom Baker, a professor who specializes in insurance at the University of Pennsylvania's Penn Carey Law school, said the plaintiffs will need to show that they somehow acted in a more 'extreme' manner than was supported by their actuarial data, which he agreed will be challenging — though he said the discovery process is a powerful tool. 'The bright side of this lawsuit is that we're gonna get some information, but count me skeptical about whether they're gonna succeed, unless they can find some kind of smoking guns.' Are there less nefarious reasons for insurers pulling back from the California market? Yes, there are alternative explanations. James Naughton, a former actuary and a professor at the University of Virginia's Darden School of Business, said that advances in data management have allowed insurers to collect more data than ever about the risks they face, with much of it the same across insurers. 'What could appear to be collusion could also be companies just using the same data. If I'm an actuary at one company, it's not hard to be an actuary at another company. The information moves,' he said. Naughton added that there also can be 'soft collusion,' a concept that refers to actors in a market trading information or having an understanding of their competitors' strategies, leading to similar decision-making. What do the plaintiff's attorneys say about all of this? 'Do we expect to find a document from party A to party B, saying today we're going to have a meeting to discuss how we're going to collude with each other on avoiding risk and going to FAIR Plan agenda item? No, I don't expect we're going to find that,' said Michael Bidart, with Shernoff Bidart Echeverria, the other plaintiffs' firm. 'Rare is the case in any litigation where you have a document that provides the ultimate direct evidence.' Instead, the attorneys said they will rely on accumulated evidence to show how the insurers allegedly conspired to drop policyholders in order to move them to the FAIR Plan for their own benefit. 'So anything else we get on top of it is just icing on the cake,' Bidart said.
Politico
23-05-2025
- Business
- Politico
A chokepoint for housing, tickets and tech
Presented by THE BUZZ: TIS' THE SEASON — It's that special time of year in the Capitol when swarms of sweaty lobbyists and even lawmakers have absolutely no clue what's going to happen to their bills — suspense day. Conditions are ripe for the 'suspense file' — from which appropriations committee members quickly approve, reject and amend hundreds of bills with big price tags — to do significant damage. Both chambers' panels killed a higher-than-average percentage of bills in the biannual process last year as they grappled with a massive budget deficit, and the state now has a shortfall for the third year in a row. But many of the legislative fatalities and makeovers coming down the pike will undoubtedly have more to do with policy. Below are a few of the bills we're watching for today: SHOWTIME: A raft of proposed rules targeting event ticket resellers like StubHub and SeatGeek will run into Assembly Appropriations Chair Buffy Wicks, who has expressed concern that pieces of Assemblymember Isaac Bryan's AB 1349 could inadvertently help cement Ticketmaster's monopoly in the market. Wicks voiced that worry about her fellow Democrat's legislation at the last policy hearing on the bill, and only voted for it on the condition that Bryan work with her on amendments as it moved toward her committee. 'I'd like to bring the opposition into those conversations so that we can land on a product that we can all wrap our arms around as it moves forward,' said Wicks, who last year carried an unsuccessful bill aimed at loosening Ticketmaster's hold on the primary sales market. Bryan, a proud concert connoisseur hailed by his colleagues for his packed event schedule, aims to keep prices down through 10 provisions that include banning the use of softwares used by scalpers to purchase tickets en masse against vendors' rules. But a compromise has for years been elusive between factions representing singers, sports teams, venue owners and primary and secondary sellers. Changes today to AB 1349 could determine whether this year is different, assuming the bill survives. Neither Bryan nor Wicks' spokesperson responded to inquiries from Playbook. ANTITRUST OR BUST: Business groups are angling to kill a Democratic-backed proposal from Sen. Melissa Hurtado and Attorney General Rob Bonta that would increase penalties on companies that engage in monopolistic or anticompetitive practices. SB 763 would hike criminal fines under the Cartwright Act, California's century-old antitrust law, for illegal behavior, such as price fixing or restraining trade. Hurtado, who had a similar measure die last year, told Playbook she's exasperated over lobbyists for the California Chamber of Commerce again opposing her effort. 'I would hate for it to have a quiet death,' Hurtado said, asserting that the bill could help lower costs for consumers. The chamber, meanwhile, argues that fines proposed in the bill (up to $100 million for a corporate violation) is excessive and 'would cripple businesses.' HOUSING HUFF: Two bills designed to increase construction of housing are up in the Senate: SB 607, which would overhaul the California Environmental Quality Act to reduce litigation delays; and SB 79, which would allow taller apartment and condo towers near mass transit stops. Both bills are carried by Sen. Scott Wiener, who argues the measures would help California get serious about addressing its vast housing shortage. Some progressive lawmakers and labor unions have lampooned the bills over their lack of affordability requirements, arguing they would largely lead to the construction of luxury housing. Senate President Pro Tem Mike McGuire is the big unknown; Capitol insiders told Playbook that he's considering amendments to scale back SB 607. BOT BATTLE: A couple bills touch on concerns about the potential risks of artificial intelligence. One by state Sen. Jerry McNerney, SB 833, would prohibit AI programs from being given control over critical infrastructure like power plants without human oversight and require good old-fashioned humans to review and implement any plans an AI might dream up. Amendments to the bill include food and agriculture, financial services and other industries under the critical infrastructure definition. The successor to last year's SB 1047, Wiener's SB 53 would cement whistleblower protections for AI workers should they see a program run amok in the lab, and would also create a state AI computing resource dubbed CalCompute. It's a far cry from the international debate Wiener sparked last year with his AI safety bill and has seen broad acceptance in the tech world. — with help from Chase DiFeliciantonio GOOD MORNING. Happy Friday. Thanks for waking up with Playbook. You can text us at 916-562-0685 — save it as 'CA Playbook' in your contacts. Or drop us a line at dgardiner@ and bjones@ or on X — @DustinGardiner and @jonesblakej. WHERE'S GAVIN? Nothing official announced. LOS ANGELES TEST RUN — Billionaire developer Rick Caruso will today deliver the commencement speech at Pepperdine Law School — and excerpts from his prepared remarks offer a window into his potential message if he runs against Los Angeles Mayor Karen Bass again in 2026. While Caruso hasn't said whether he plans to make another bid for mayor, his critiques of Bass' handling of the wildfires has fueled speculation about his plans. Two key lines from his speech, which Playbook obtained early, that could further fuel that chatter: On failed prevention efforts: 'Sadly, this horrifying disaster was avoidable. A week earlier, a wildfire flared near here, providing a clear warning to get prepared. What happened next was a series of tragically mishandled events and failure of leadership at many levels allowing the roaring hell of Jan. 7.' On recovery and rebuilding: 'While our wildfire recovery remains ongoing, I promise you this: We will not rest until the school bells and church choirs ring out again, loud and clear, from Malibu all the way to Eaton Canyon. Indeed, what a godly day that will be. I cannot wait for that day.' A BUDGET, BEGRUDGINGLY — Los Angeles City Council approved a budget for the upcoming fiscal year Thursday afternoon, even though none of the players involved sounded particularly happy about it. 'It's easy to get lost in the details and lose sight of the magnitude of the crisis we're in,' said Councilmember Katy Yaroslavsky, chair of the budget committee, at the start of a marathon hearing. 'It's real, and it will likely only get worse, given what's happening in Washington.' Yaroslavsky chose to accentuate the positive — including 1000 fewer layoffs than Mayor Karen Bass' original proposal — and called the spending plan a 'bare-bones budget that puts us on the path toward fiscal solvency.' The plan passed by a 12-3 vote; among the ayes, notably, was the bloc of progressive councilmembers who had defected in past years over objections about increased police spending. This time, the detractors were the more moderate members, including Councilmember Traci Park, who laced into the city's homelessness spending as a 'taxpayer boondoggle.' 'Frankly, at this point, it's just embarrassing,' Park said. CAMPAIGN YEAR(S) BETWEEN A DOC AND A HARD PLACE — Democratic Assemblymember Jasmeet Bains introduced a resolution to censure California House Republicans for voting for the GOP megabill because it included cuts to Medicaid and food benefits. The move from Bains, a politically moderate physician from the Central Valley, is sure to fuel preexisting chatter that she could challenge battleground Republican Rep. David Valadao. Already, she has been featured in SEIU ads running in Valadao's district pushing him not to cut Medicaid, though she has not said she will run. 'Instead of standing up for us, our Republican delegation sold us out,' Bains said in a statement. 'The Negligent Nine betrayed California, putting loyalty to Trump and their political party above the 40 million residents of the greatest state in the union.' QUICK CASH — Anuj Dixit, a lawyer and the newest challenger to GOP Rep. Ken Calvert, reports raising more than $150,000 in the 48 hours since jumping into the race. Dixit joins an already-burgeoning crop of Democratic contenders for the Inland Empire district, including former OneRepublic bassist Tim Myers and entrepreneur Brandon Riker. CONVENTION EXTRAS NEXT UP — Democratic Reps. Derek Tran, Robert Garcia, Sydney Kamlager-Dove, Dave Min and Jimmy Gomez have been added to the list of officials who will speak at their home state Democratic convention later this month in Anaheim. NEVERMIND, BOYS — A resolution from San Francisco Democratic leaders urging the party to pay more attention to the well-being of men and boys won't be presented at the state party convention next weekend after all. Emma Hare, a vice chair of the county party who wrote the resolution, said she didn't submit it in time for it to be considered at the convention. Nevertheless, the SF Democratic County Central Committee will consider her resolution at its regular May 28 meeting. CLIMATE AND ENERGY ELON'S EXIT — Congressional Republicans dealt Tesla a blow Thursday when they canceled California's nation-leading vehicle emissions rules. Read about the breakup and why Musk might not be pining for lost electric vehicle incentives in last night's California Climate. Top Talkers HIGHWAY TO THE BALLOT — The campaign to recall San Francisco Supervisor Joel Engardio over his role in converting the Great Highway into a park told the SF Standard it has collected enough signatures to put the recall to voters. Engardio championed a successful ballot measure to make the change. Engardio 'ignored our community's needs and kept pushing policies and propositions that hurt us and all San Franciscans,' campaign volunteer Selena Chu said. BUDGET BACKLASH — Foster youth advocates are blasting Gov. Gavin Newsom's latest budget proposal for cutting funding for a helpline for foster families and omitting a request for money for foster family agencies, CapRadio reported. 'We don't think it was appropriate to target such a vulnerable population,' said Susanna Kniffen, a child welfare policy director at Children Now. AROUND THE STATE — AFSCME Local 2620, which represents nearly 5,000 health care and social service workers, created a $1 million strike fund in the latest sign of tensions with their employer, the state. (Sacramento Bee) — A San Francisco supervisor's proposal to more evenly spread homeless shelters throughout the city could prompt Mayor Daniel Lurie's first major policy disagreement with the county board. (SF Chronicle) — Fresno lost its pro-housing designation from the state, which will make it more difficult for the city to access affordable housing grants. (GV Wire) PLAYBOOKERS WEDDING BELLS — Louis Mirante, VP of public policy for the Bay Area Council, will marry Dr. Kanishka Patel, a UC Davis Health oncologist, in a multi-day matrimonial extravaganza over Memorial Day weekend in San Francisco. PEOPLE MOVES — Levi Lall is now counsel at the DOJ's office of legal policy. He previously was counsel for Rep. Darrell Issa (R-Calif.) and the House Judiciary Subcommittee on Courts, Intellectual Property, Artificial Intelligence and the Internet. — Carmen-Nicole Cox has opened The Cox Firm for Law and Policy, offering legal and lobbying services. She was most recently director of government affairs for ACLU California Action and previously served as chief of legislation for the California Department of Corrections and Rehabilitation for Govs. Gavin Newsom and Jerry Brown, and before that as deputy legal affairs secretary for Brown. BIRTHDAYS — author Yaron Brook … comedian Drew Carey … recording artist Jewel BELATED B-DAY WISHES — (was Thursday): Dustin Moskovitz ... Michael Wilner ... Michael Kostroff WANT A SHOUT-OUT FEATURED? — Send us a birthday, career move or another special occasion to include in POLITICO's California Playbook. You can now submit a shout-out using this Google form.
Yahoo
19-05-2025
- Business
- Yahoo
Innovative Health awarded $147m in antitrust lawsuit against J&J's Biosense Webster
Innovative Health has been awarded $147m in damages from a lawsuit against Biosense Webster relating to the Johnson & Johnson (J&J) business's policy to withhold cardiac mapping support services from hospitals that chose to purchase reprocessed catheters from Innovative instead of Biosense's new devices. Originally seeking $143m in damages, Innovative first filed its lawsuit in 2022, arguing that Biosense's policy unfairly restricted competition and violated both the Sherman Act and California's Cartwright Act that prohibit market monopolisation. Initially dismissed in 2022, the case was later revived by the Ninth Circuit in 2023, paving the way for a jury trial. Delivering a unanimous verdict in a California court, a federal jury found that J&J subsidiary Biosense Webster violated federal and state antitrust laws by withholding clinical support to hospitals using Innovative Health's FDA-regulated, reprocessed catheters. Daniel J Vukelich, president and CEO of the Association of Medical Device Reprocessors (AMDR), commented: 'For too long, J&J has used tying arrangements and other tactics to interfere with fair competition from lower-cost, FDA-regulated, reprocessed 'single-use' devices (SUD). 'We hope this jury's message will be heard loud and clear: hospitals want to reduce costs and greenhouse gas emissions by using more reprocessed SUDs without fear of retribution by their original equipment manufacturers (OEMs).' Accompanying Vukelich's remarks, AMDR advised hospitals to add guardrails to their processes and reminded them that OEMs cannot lawfully revoke support, void warranties, withdraw service, or otherwise retaliate for using FDA-regulated reprocessed SUDs. The AMDR said: "Make it a policy to document and escalate any such threat and remind sales reps this activity is illegal and will not be tolerated." Other AMDR advisements included tracking SKU pricing over time across vendors to skirt potential price-gouging practices on OEMs' re-processable equipment models and to 'explicitly deny' any equipment updates that "just happen" to block reprocessed devices or force obsolescence. The AMDR concluded: "Adopt these guardrails as formal policy, train staff to spot violations, and remind OEM partners that the rules of engagement have changed – hospitals will no longer put up with anti-reprocessing sabotage." Medical Device Network has reached out to Innovative Health and J&J for comment on the lawsuit. "Innovative Health awarded $147m in antitrust lawsuit against J&J's Biosense Webster" was originally created and published by Medical Device Network, a GlobalData owned brand. The information on this site has been included in good faith for general informational purposes only. It is not intended to amount to advice on which you should rely, and we give no representation, warranty or guarantee, whether express or implied as to its accuracy or completeness. You must obtain professional or specialist advice before taking, or refraining from, any action on the basis of the content on our site. Sign in to access your portfolio
Yahoo
08-05-2025
- Business
- Yahoo
Some California drivers are getting free cash in their bank accounts. What you need to know
California drivers who submitted a claim to get their cut of a $50-million settlement over price gouging at the gas pump are starting to see the payments land in their bank accounts. Starting in late April, more than a million Californians started receiving payments of $21.65, according to the attorney general's office. The money is arriving by check, direct deposit or via Venmo, depending on what the claimant chose as their preference. The payments are coming from a settlement between the state of California and three gasoline trading firms who allegedly worked together to manipulate gas prices nine years ago, violating California antitrust laws, according to the office of Atty. Gen. Rob Bonta. The companies took advantage of a market disruption following an explosion in February 2015 at an Exxon Mobile refinery in Torrance 'to engage in a scheme to drive up gas prices for their own profit,' officials said. As a result, California consumers paid more for their gas. In July, the trading firms settled with the state of California and as part of the settlement, Vitol, SK Energy Americas and South Korea's SK Trading International have agreed to pay $50 million into two settlement funds. Of the total, $37.5 million would be distributed to consumers as compensation for violations of the Cartwright Act. The settlement did not include an admission of fault from the trading companies. Sign up for Essential California for news, features and recommendations from the L.A. Times and beyond in your inbox six days a week. This story originally appeared in Los Angeles Times.
