Wal-Mart Gear Oil Draws Hefty Fines


The district attorneys for five California counties recently reached a $357,800 settlement in a civil suit filed against Wal-Mart Stores Inc. and Warren Distribution Inc., saying Wal-Mart SuperTech gear oils sold there from 2004 to 2006 failed to meet advertised viscosity levels.

Wal-Mart and Warren Distribution cooperated with prosecutors during the investigation and agreed to undertake additional testing procedures in order to comply with the law. Under the settlements terms, the two companies, without admitting any wrongdoing, agreed to pay $257,800 in civil penalties, $75,000 to reimburse the investigation and prosecution costs, and $25,000 in restitution. The civil penalties will be divided equally among the five counties.

The initial investigation grew out of inspections of SAE 85W-140 and 75W-140 SuperTech gear oils by officials with the Shasta County Weights and Measures Petroleum Division officials and later by state officials. Omaha, Nebraska-based Warren Distribution makes the gear oil. Shastas district attorney then joined with the Monterey, Napa, Solano and Sonoma County attorneys to file the consumer protection case.

Shasta County District Attorney Jerry Benito said in a statement that about 5,000 bottles of the non-compliant oil was sold in California. The gear oil is used primarily in heavy machinery and large trucks. Benito theorized it was unlikely any actual damage occurred to any Californians machinery, as damage would only occur in extremely hot or cold temperatures.

The problem was with a few of the bottles that were shipped, not the entire amount, Warren Distribution CEO Robert Schlott told Lube Report. It was discovered that there were certain batches over a long period of time that were not compliant on a cold- temperature test for the gear oils.

Schlott said there was no reasonable way to precisely identify the quantity of bad gear oils. The quantity that you saw reported [by the district attorney] was the total amount that was shipped into the state over that period of time that could have had issues with it, he explained. We know that there were a number of good batches during that time. We also know there were some batches that were out of compliance on this cold temperature specification.

According to Schlott, Warren Distribution codes batches and orders as they go out for tracking purposes. That enabled the company to confirm the bad gear oil batches were limited to the five counties in California and did not to go out to Wal-Marts in other states, he added. We have coding that goes back through our batches, and we record that coding to the distribution points at Wal-Mart, he explained.

The situation came up with gear oils manufactured in the 2004-2006 time frame, he said, and was rectified shortly after the company discovered the problem. We put additional testing in place at the packaging plant to ensure compliance before anything was packaged or shipped, he continued. When it happened, there was no knowledge that it was a problem. I wont call it an obscure test – its a test thats a test of standards for gear oil – but its a test thats not routinely run.

He said Wal-Mart did and does continue to routinely have a third-party testing company pick up samples of the products and other lubricants the company sells, to verify theyre in full compliance with all standards and specifications. We do support that and think its a good idea, Schlott added.

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