Columbia Falls brewery among businesses suing Montana secretary of state over duplicate charges

Backslope Brewing of Columbia Falls is one of seven small businesses suing Montana Secretary of State Christi Jacobsen, alleging her office overcharged many businesses for various fees and then declined to issue refunds unless requested in writing.

The class-action complaint, filed in Lewis and Clark County District Court by the nonprofit law firm Upper Seven Law, alleges that when businesses and individuals log onto the secretary of state's website to pay business licensing fees, or fees for services such as lien searches, "they are sometimes charged twice or more without their knowledge.

"While the overcharge itself is normally the result of a forgivable technical glitch, the secretary of state's policy for handling the duplicate charges expressly violates Montana state law, not to mention basic principles of contract law," the lawsuit alleges.

"This might sound like a simple enough policy, but it is nefarious," the complaint states, referring to the policy of not issuing refunds without written requests. "Businesses expect the state to charge them for what they actually owe. With no receipt documenting the excess, discovering a duplicate charge presents a challenge."

Jacobsen, who took office in January, has continued the office's policy of issuing no refunds unless requested in writing, the complaint states. The suit alleges the Secretary of State's Office wrongfully collected at least $120,000 in duplicate fees during the 2020 fiscal year, and "has continued to wrongfully retain overcharges from its customers through fiscal year 2021 and into fiscal year 2022."

The lawsuit alleges the office knew about the problems with the office's digital payment platform and could have determined which customers were affected, yet required affected customers to request refunds in writing anyway.

In response to reporters' questions about the overcharging problem last fall, the office asserted customers were immediately refunded "as the office became aware of the overpayments." An employee of the office "suggested that the duplicate charging issue occurred for approximately one month in the spring of 2020 and was traceable to a specific version of Google Chrome," the complaint states.

The lawsuit alleges, however, that the double-charging issues began prior to the one-month period, March 3 to April 5, 2020, and continued past that date.

The plaintiffs are seeking injunctive and declaratory relief for various claims, including procedural due process, unjust enrichment and constructive fraud. They're also asking the court to issue refunds and change the policy requiring written refund requests.

In addition to Backslope Brewing, the other plaintiffs are Purple Snow Promotional of Billings, Pine Street Rentals of Townsend, Essential Mountain Products of Helena, Black Dog Farm of Livingston, Wicked Good Handyman Service of Helena, and the Mental Health Update of Missoula.

News editor Lynnette Hintze may be reached at 406-758-4421 or lhintze@dailyinterlake.com.