After a public comment period, the Federal Trade Commission has approved final orders against motorcycle manufacturer Harley-Davidson Motor Company Group, grill maker Weber-Stephen Products, and the manufacturer of Westinghouse outdoor power equipment, MWE Investments, for illegally restricting customers’ right to repair their purchased products.
In cases announced in June, the FTC alleged that Harley-Davidson and MWE Investments included terms in their warranties that claimed that the warranty would be void if customers used independent repairers or third-party parts, in violation of the Magnuson-Moss Warranty Act and the FTC Act. In addition, Harley-Davidson allegedly failed to properly disclose all warranty terms in a single document, and instead directed consumers to visit a local dealership to fully understand the warranty. In July, the FTC announced a similar case alleging that Weber’s warranty illegally claimed that the use of aftermarket parts would void the company’s warranty on gas and electric grills.
The orders require the companies to take multiple steps to correct their unlawful behavior:
- Prohibit further violations: The companies will be prohibited from further violations of the Warranty Act, and in Harley-Davidson’s case, the Disclosure Rule. They will also be prohibited from telling consumers that their warranties will be void if they use third-party services or parts, or that they should only use branded parts or authorized service providers. If the companies violate these terms, the FTC will be able to seek civil penalties of up to $46,517 per violation in federal court.
- Recognize consumers’ right to repair: Harley-Davidson and MWE Investments will be required to add specific language to their warranties similar to the following: “Taking your product to be serviced by a repair shop that is not affiliated with or an authorized dealer of [Company] will not void this warranty” and/or “using third-party parts will not void this warranty.” Weber must add to its warranty a statement that “Using third-party parts will not violate this warranty.”
- Come clean with consumers: The companies must send and post notices informing customers that their warranties will remain in effect even if they buy aftermarket parts and/or patronize independent repairers.
- Alert dealers to compete fairly: Harley-Davidson and MWE Investments are being required to direct authorized dealers to remove deceptive display materials, train and monitor employees, and not promote branded parts and dealers over third parties.
The Commission votes to approve the final orders against Weber-Stephen Products and MWE Investments were 5-0. The Commission vote to approve the final order against Harley-Davidson and issue letters to commenters was 4-0.
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