Partners Franco Corrado and Nathaniel Bruhn provided insights on warranty claims in the automotive space, analyzing trends in consumer class actions asserting claims for breach of warranty, the Federal Trade Commission’s increased focus on the right to repair and recent enforcement actions, and the Massachusetts Right to Repair law and compliance challenges.
Key takeaways for auto manufacturers:
- Understand the applicable law. State law governs express warranty claims and these differ from state to state.
- Review your warranties for compliance with the Magnuson-Moss Warranty Act. Magnuson-Moss is the main enforcement mechanism for addressing the right to repair and it regulates consumer warranties, including vehicle warranties. Violations of Magnuson-Moss can also give rise to violations of the FTC Act, which prohibits unfair, deceptive practices in connection with competition.
- Avoid explicit or implicit tie-ins in your warranties. Removing problematic language that may tie where and how repairs are made to the warranty.
- Carefully craft technical service bulletin (TSB) language to avoid expanding the warranty. A TSB typically covers parts or processes that malfunction but are not considered safety issues.
- Stay up to date on “right to repair” laws. As technological developments, including electric vehicles, have advanced in recent years, right to repair laws have taken on greater significance.
- Review new vehicle warranty language. Ensure that it includes clear notice and presentment requirements.
Morgan Lewis Automotive Hour is a series of automotive and mobility industry–focused webinars led by members of the Morgan Lewis global automotive team. The 2023 program is designed to provide a comprehensive overview on a variety of topics related to clients in the automotive and mobility industry. View past and upcoming presentations here >>