Minimum gas markup law struck down

As consumers are seeing gas prices down from the summer, they'll also see a Depression-era law that regulates them, tossed out.

"We really look at this as a victory for the people of Wisconsin," said John Dibble, an attorney representing Flying J, a Utah company that owns gas stations in Wisconsin.

The company sued the state, alleging a Wisconsin law requiring gas stations to mark prices up by more than nine percent over the wholesale price, is unconstitutional.

"An efficient, competitive retailer can make a reasonable profit for less markup than that and that savings will go out to the consumer in Wisconsin," Dibble said.

In an 18-page ruling a federal judge agreed, immediately killing a law that's been on the books since 1939.

"The Department of Justice will not be bringing any actions to enforce minimum markup laws so long as this order stands," spokesman Bill Cosh said.

Marjorie Young works with U.S. Oil, a company that supplies 400 stations in Wisconsin.

"We're disappointed with the ruling, it has gone to many courts and it's been held to be constitutional and valid," said Marjorie Young of U.S. Oil of Combined Locks, which supplies 400 stations in Wisconsin.

With the sliding economy, she says now is not the time for a decision that hurts small businesses. Young feels independently-owned gas stations will be hit hard.

"We've always felt this law helped protect that person, that mom and pop type gas station convenience store owner," Young said.

"They figure that some large entity will come in price the gas very low, drive out competitors and then jack the price back up," Lawrence University economics professor Marty Finkler said.

Still, Finkler doesn't see that happening. He feels the ruling opens the door to competition, but will change little for consumers and gas stations because it's the volatile cost of gas not a minimum markup that sets the bar at the pump.