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Wednesday, June 21, 2000

Chevron loses
bid to oust dealer
without trial

A judge says Young's
retaliation claims and the
nonrenewal of his
lease raise questions

By Rob Perez


A federal judge has denied Chevron Corp.'s request that the court, without holding a trial, rule that dealer Frank Young violated his lease and the company properly terminated it.

Chevron Corp. Judge David Ezra's denial yesterday of Chevron's motion for partial summary judgment means that Young, an outspoken Chevron critic, will not be evicted for the time being from the Kakaako station that his family has run for nearly 50 years.

Ezra said Young's allegation that he was being retaliated against for his criticisms raised questions about what Chevron's real reasons were for ending the agreement.

Chevron has denied any retaliation and said it did not renew Young's contract, which expired last year, strictly because of noncompliance.

Chevron sued Young last year, asking the court to order him to vacate the station and pay damages.

Chevron has cited 16 instances in 1998 and 1999 in which Young did not have the station open during the hours required under his lease. The company said the breaches occurred despite repeated warnings to Young.

Ezra said Chevron eventually may prove the termination was based purely on contractual issues. But at the start of yesterday's hearing he noted that what Young has alleged thus far appears to show retaliation.

Eric Seitz, Young's attorney, said Chevron for more than 40 years never made an issue of the station's operating hours. But, Seitz said, after Young started criticizing the company's pricing practices over a three-year period and lobbying for legislative bills that Chevron opposed, he faced eviction.

Chevron, however, said the retaliation allegation was not supported by evidence. Attorney Michael Lam, who represents the company, called the allegation a "red herring" and said it had no bearing on Young's noncompliance with his lease.

"In reality, this retaliation doesn't exist," he told Ezra.

Although Ezra denied Chevron's motion, calling it premature, he warned Young that the next time the retaliation issue comes before the court, he better have evidence -- not just innuendo -- to support the charge or he will be in trouble.

The judge also said Chevron can refile its motion after Young completes the discovery process of questioning potential witnesses to gather evidence.

In recent years, Young has criticized Chevron for allegedly charging excessive wholesale prices to dealers, resulting in excessive profits to the company and excessive prices to consumers.

The state has accused Chevron and other oil companies of essentially the same thing as part of its pending $2 billion antitrust lawsuit.

The companies have denied any wrongdoing.

After yesterday's hearing, Young said he was pleased with Ezra's ruling. He also said he will be able to produce evidence supporting his retaliation allegation.

"When we go to court, the truth can be known," Young said.

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