This summer, we wrote about FTC orders against Harley-Davidson and outdoor generator maker MWE Investments, as well as grill-maker Weber-Stephen Products, requiring them to fix their warranty terms. After a public comment period, the FTC has now approved final orders against the companies for illegally restricting customers’ right to repair their purchased products.
In June, the FTC announced that motorcycle giant Harley-Davidson was being charged with unlawfully conditioning its warranties on the use of unauthorized parts and failing to provide warranty terms in a single document. Specifically, the FTC alleged that Harley-Davidson’s 2021 warranty states that the use of parts and service procedures other than those approved by Harley-Davidson may void the warranty, which the FTC said was a violation of the Magnuson Moss Warranty Act and the FTC Act. Additionally, the warranty required consumers to “see an authorized Harley-Davidson dealer for details,” which the FTC said was a violation of its rule on the Disclosure of Written Consumer Product Warranty Terms and Conditions. The FTC alleged that MWE Investments’ warranty also similarly conditioned coverage on the use of genuine MWE Investments parts and accessories.
A few weeks following the announcement, the FTC ordered grill-maker Weber-Stephen Products to fix its warranty terms, which were similarly alleged to have restricted consumers’ right to repair. In its complaint, the FTC alleged that Weber’s warranty violated the Magnuson Moss Warranty Act by restricting consumers’ choices and forcing them to spend more money on replacement parts. Weber’s actions were also said to have prevented independent repairers and manufacturers from competing on a level playing field.
Under the final orders, the companies will be prohibited from telling consumers that their warranties will be void if they use third-party services or parts and must add specific language to their warranties clarifying this. They are also required to send and post notices to inform consumers that their warranties will remain effective even if they buy aftermarket parts/use independent repairers, and must not promote branded parts and dealers over third parties, among other things.
In 2018 the FTC announced it had sent letters to six major companies warning them that their warranties may violate federal law, making other companies aware of the FTC’s concerns. Now, given the most recent orders, it is especially important that companies revise their warranties and ensure they’re in compliance.