A recent class-action lawsuit filed in California's Eastern District accuses Kalibrate Fuel Pricing, an AI-driven software company, and its customers of anti-trust violations. The lawsuit alleges that the software, used by gas stations to set competitive prices, has led to artificially high fuel prices in the state. Kalibrate's software collects and compares non-public pricing and sales data from participating stations, allowing them to maximize profits while staying locally competitive. The plaintiffs claim that this cooperative price adjustment has resulted in a 4.5 percent increase in fuel prices. The lawsuit also highlights a 'restoration' feature in the software that enables station operators to initiate or join coordinated price hikes. Furthermore, the plaintiffs allege that Kalibrate has shared proprietary pricing information with prospective clients. With California already bearing the highest gas prices in the country, the lawsuit argues that every one-cent increase in prices translates to an extra $134 million in fuel costs annually for California fuel purchasers. The case relies on a recent amendment to California's anti-trust law, which adds language specific to the use of common pricing algorithms. As the lawsuit unfolds, it will be interesting to see how the court navigates the technical aspects of the AI-powered pricing software and its impact on the gas market. The outcome of this case may have significant implications for the use of similar software in other industries and states.

Source: Car and Driver