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FTC Completes Review of Magnuson-Moss Warranty Act

August 19, 2015

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The Federal Trade Commission ("FTC") recently announced that it had completed its review of rules governing consumer product warranties under the Magnuson-Moss Warranty Act and decided to keep many of the rules in its current form. These rules affect retailers and manufacturers of technology including personal computers, appliances, mobile devices and other kinds of electronic consumer devices. Two items from the FTC's review are noteworthy:

  1. The FTC has stated that the intent of the rules are to make warranty information available at the point of sale. When in person in a brick and mortar transaction, the point of sale is in the store and for online transactions, the point of sale is where consumers purchase the product online. That's where warranty information should be made available. Thus brick and mortar sellers should not tell consumers that warranty information is available online only. Online sellers should not hide warranty information in online terms and conditions that are not easily accessed. Online sellers can comply with the rules by using a clearly labeled hyper-link with text that expressly indicates that warranty information can be obtained through the link (or online access).

  2.  "Tying" arrangements are deemed to be deceptive and should be avoided. "Tying" is where warranty coverage is conditioned on the consumer's use of a particular type of replacement product or repair service identified by a brand or name. For instance, some sellers have stated that the warranty is void if the service is performed by anyone other than an authorized dealer or someone else designated by the seller or that all replacement parts must be of a particular type or brand. Such provisions may be deceptive and, therefore, should be avoided.

For more information, please contact:

Jonathan Storper

415-995-5040 Direct Phone
415-995-3466 Fax

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