If you’ve ever fueled up during a visit to Walmart, you could have a coupon coming your way.
Registration has begun for a class action settlement in a case involving Murphy Oil USA. And if you qualify, you could get a piece of the proposed $257,500 settlement.
The case originated in May 2018. That’s when two customers sued the gas station/convenience store company, which has more than 1,400 locations in 26 states, the majority of them located alongside Walmart stores.
The plaintiffs said Murphy was improperly charging sales tax on the full price of discounted items. In October 2017, Steven Gregory Holt of Alabama bought two Kit Kat candy bars that were regularly priced at $1.39 each, but were on sale as 2 for $2. The lawsuit states that he should have been charged 12 cents tax, equal to 6% of the selling price. Instead, he was charged tax on the candy bars’ regular price.
A couple of weeks later, co-plaintiff Robert Enslen made the same purchases in Florida, and was similarly overcharged. Both men say they have made “numerous purchases” of discounted items at Murphy, and were therefore “routinely, systematically charged sales tax on the full, undiscounted price of the items”.
Such cases frequently occur when coupons are involved. In all but a few states, sales tax is calculated based on the total before any manufacturer’s coupons are used, but after any store coupons are used. When coupons aren’t involved but an item is on sale, as in the Murphy case, the same principle applies based on who’s funding the discount. If it’s a manufacturer incentive, sales tax is assessed before the discount is applied. But if it’s a store discount – as the plaintiffs in this case argue the Kit Kat sale was – sales tax should only be assessed on the final selling price.
“The discounted amount, the portion of the discount that was funded by Murphy, is not taxable and Murphy customers should not have been charged for tax on that amount,” the plaintiffs argued. So they sued Murphy for unjust enrichment, negligence, and deceptive and unfair trade practices.
The two sides agreed to settle the case just a few months after the lawsuit was filed. Their settlement agreement was approved in March, and Murphy customers who want to be part of the class action – and share in the ultimate settlement – can now register on murphyoilusasettlement.com. Customers are eligible in all states where Murphy USA does business, except Texas and Missouri, where the settlement notes an “investigation revealed that Murphy was properly collecting sales tax in those jurisdictions”.
You won’t get rich from this settlement, though. Murphy has agreed to provide $1 coupons to as many as 257,500 affected customers.
But at least registering is easy, so it might be worth a minute of your time now for the promise of a dollar later. All you have to do is provide your name and email address, after acknowledging that you bought a discounted product from Murphy USA and were charged sales tax on the full price, or after January 8, 2016.
And then you wait.
The final hearing on the settlement agreement is scheduled for September. Only after the settlement is given final approval, will the coupons be sent out. And as anyone who’s still waiting for their share of the 2015 StarKist tuna settlement can tell you, sometimes that process can take a while.
Murphy has also agreed to pay up to $2,500 to each of the two plaintiffs, and up to $250,000 in attorneys’ fees and expenses. Before it’s all over, then, this settlement could end up costing the company well over a half million dollars.
So you can bet the next time you buy a Kit Kat while fueling up, Murphy USA will charge you the correct amount of sales tax. At this rate, Murphy won’t be able to afford not to.
