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Franchisees Sue BP, Say Chain Knew Its Mandated POS Systems Double-Charged Customers And Didn’t Fix It

May 4th, 2011

The lawsuit also alleged other problems, including tax reporting issues. “As to be expected when rolling out a system that had significant material defects, the Retalix system has and continues to suffer from poor to inaccurate performance resulting in, among other things, lost operation time, lose revenue, loss of customers due to shut down of operations, inability to control inventory, inability to close taxes and increased costs and burdens,” the filing said.

The filing claims that the stores had complained about the issues to both BP and Retalix, but nothing was fixed.

“Despite promises by BP Defendants and Defendant Retalix to fix these defects and their continued unsuccessful and futile attempts to fix the defects, the material defects still exist and continue to cause plaintiffs significant damages,” the lawsuit said. “Plaintiffs no longer have any confidence in the Retalix POS system and the ability of BP Defendants and Defendant Retalix to repair these defects.”

The lawsuit also claimed that BP “refused to implement the older system, which was satisfactorily working and refused to consider other POS solutions used by other national service station brands.”

As is tradition in such litigation, BP and Retalix have declined to comment on the lawsuit’s specifics. “Although Retalix has not been served yet, we believe this class action is without any merits and we will defend this vigorously,” said Brad Prize, Retalix’s VP of Global Marketing Communications.

These cases are rarely about what they say they are about. The Burger King case talked about POS, but it was really about control, jurisdiction and trying to get a judge to set limits on contractual obligations. The BP case is clouded by the oil giant’s plans to sell ARCO and the possibility that such a lawsuit might be settled quickly to make it go away, so it won’t depress the sales negotiations for ARCO.

A report this week in a respected convenience store chain media outlet, CSP Daily News, said that BP offered franchisees a settlement, where BP would pay more of the cost of the Retalix systems “but only if a franchisee continues to use the Retalix system for the next five years and remains a franchisee with BP-ARCO for that period.” That BP offer also reportedly insisted that the stores “waive all claims, known and unknown, related to losses that have been sustained concerning the Retalix system and will be prohibited from asserting future claim.” Yeah, that’s going to go over well with franchisees.


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