Alabama Sues Gas Stations for Price Gouging

MONTGOMERY, Ala. -- The state of Alabama is suing two Montgomery gas stations, a Stop N Go Express and the Cannon Kwik Stop, for alleged price gouging after Hurricane Katrina, reported the Montgomery Advertiser .

On Wednesday, Attorney General Troy King announced civil suits against the two locations. The state is also going after a Cannon Oil Co. in Monroeville, Ala., and a Bud's #13 in Decatur, Ala., for what Attorney General King called "economic offenses against the people of this state," according to the newspaper. All of these stations allegedly increased gas prices by more than 25 percent, even though wholesale price hikes had not affected them.

In the days following Hurricane Katrina gas prices shot up across the nation, in many cases to more than $3 per gallon, prompting 45 attorneys general to investigate, the Montgomery Advertiser reported.

Price gouging in Alabama carries a maximum civil penalty of $25,000 a day and can include loss of business license.

In the days following Katrina, the AG's office received more than 1,100 price gouging complaints statewide, with about 90 percent of them having to do with gas prices. King said in the report that most businesses in the state did not break the law.

The investigation into illegal price increases during the state of emergency is ongoing, according to the newspaper.