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Ethanol makes its way to the courtroom

Class-action filing claims oil companies were aware of the damage the additive would cause to gas tanks

Class-action filing claims oil companies were aware of the damage the additive would cause to gas tanks

A California boater has filed a class-action suit asking 10 oil companies to pay for damages that ethanol-blended gasoline is alleged to have caused to his yacht’s fiberglass fuel tanks and to the tanks and engines of other boat owners in the state.

Read the other story in this package: Potent E20 gas could increase fuel woes

Larry Turner, 50, a Los Angeles attorney and CPA, says it is costing him $35,000 to replace the fiberglass tanks in his 38-foot Mediterranean motoryacht with aluminum ones. He says ethanol in the gasoline was leaching resin out of the walls of the fiberglass tanks, weakening them and causing engine problems.

“My engines started shutting down,” he says. “The carburetors were clogged; the fuel filters were clogged.” He kept replacing filters, yet the engines kept stalling.

“I was shocked to find out it was gas eating up the gas tanks,” a problem that was dangerous as well as costly, says Turner, who boats out of Marina del Rey. “There were times when I was bringing the boat back in with a wall of rocks on one side and sailboats on the other, and the engine shuts down,” he says.

He’s not yet sure if he’ll have to replace the engines. “Is it just the carburetors that need to be replaced?” he asks. “I hope it stops there.”

Others have reported ethanol-related engine damage — bent pushrods and valves — due to a sludgy buildup of carbon and leached resin. Studies also have documented phase separation, a tendency of ethanol to bond with water in the gasoline when it sits for a long time, then sink to the bottom of the tank to form a damaging ethanol/water cocktail.

Turner believes the oil companies should pay for the damage this causes. His suit, filed April 7 in U.S. District Court in Los Angeles, says the oil companies knew about the problems associated with storing ethanol in fiberglass tanks when they began selling ethanol gasoline in California around 2004. But, he claims, they didn’t warn boaters about these problems or post any notice on the fuel pumps that boaters were buying anything other than what they were used to.

“This affects a lot of people, but it has been falling on deaf ears,” says Ronald Karz, an attorney with theLos Angeles firm Kabateck Brown Kellner, which is representing Turner ( ). He says the suit should open some ears.

No one is sure how many boats have fiberglass tanks. BoatU.S. estimates the number at less than 10,000 — mainly older Bertrams, Hatterases, Chris-Crafts and a few Vikings; custom or semicustom boats of more recent vintage; and a few smaller boats, says Bob Adriance, editor of Seaworthy, BoatU.S.’s magazine for boat owners in its insurance program.

BoatU.S., which has done some studies of ethanol’s effects on fiberglass, advises against even trying to use ethanol gasoline in a fiberglass tank. “I tell people don’t even put ethanol in it,” says Adriance. “Replace the tank. Because if you don’t, you’re going to ruin your engine.”

Ethanol is blended into more than 50 percent of the gasoline sold in the United States, most of it as an E10 blend of 10 percent ethanol and 90 percent gasoline, according to the Renewable Fuels Association. The association says all gasoline sold in California, Minnesota, Missouri, Texas and along the East Coastfrom Washington, D.C., to Boston is ethanol gasoline. A few states — Minnesota, Missouri and Hawaii — require it, according to the PewCenter on Global Climate Change. Montana and Iowa plan to require E10 (Iowa for 25 percent of its gasoline, Montana for all of it). Minnesota has mandated a 20 percent ethanol blend by 2013.

Twenty-three states give tax credits for using biofuels such as ethanol. Still other states or localities, as a practical matter, must use ethanol to meet clean air standards. (Ethanol is a vegetable-based oxygenate that not only stretches gasoline but helps it burn cleaner and boosts its octane rating.)

The Environmental Protection Agency has required oxygenates in gasoline since 1990 to reduce air pollution in regions with poor air quality. The EPA encouraged using MTBE (methyl tertiary butyl ether) in gasoline until 2000, when it began phasing it out because of concerns about its toxicity in drinking water. Ethanol has replaced MTBE as the oxygenate of choice in gasoline. The Federal Renewable Fuels Standard required that 4.2 percent — or about 4.7 billion gallons — of the fuel dispensed in this country in 2007 come from renewable resources. That figure increases to 7.5 billion gallons by 2012. Ethanol has been the workhorse for complying with that standard.

With this profusion of local, state and federal rules requiring or at least promoting ethanol’s use, the class-action suit is no slam dunk, Karz says. Some rulings on MTBE have said oil companies can’t be responsible for damages from that fuel additive because the government effectively mandated its use; others say companies can be liable for damages from these government-promoted additives. Karz believes oil companies can satisfy all these government mandates “without putting ethanol in gasoline that is destined for boats.”

Defendants in the suit are Chevron USA Inc., Exxon Mobile Corp., Valero Energy Corp., BP America Inc., Shell Oil Co., Tesoro Corp., ConocoPhillips Co., Tower Energy Group, Petro-Diamond Inc., and Big West of California. The suit alleges that ethanol gasoline is a defective product for use in boats, because it damages fiberglass tanks and boat fuel systems, that oil companies knew about these problems when they introduced ethanol gasoline and didn’t tell boaters about them, and the oil company actions were unfair and deceptive.

Exxon, Chevron, BP and Shell declined comment, saying either they don’t comment on litigation or they had not been served the papers yet. Turner’s attorneys are contemplating similar suits in other states, but first “we’re waiting to see what the [boater] response is to this lawsuit,” says attorney Brian Kabateck.