FTC Sends Out Warnings to Manufacturers to Revise Their Warranty Statements

  • ftc-warranty-statement-letter

    Yesterday, Apple was on the spotlight again for a problem with its latest iOS 11.3 update killing touch functionality on iPhones and iPads that had their displays repaired by third-party repair shops. Shortly after this report circulated online, a staff of the Federal Trade Commission (FTC) sent out warning letters to six U.S. companies.

    Although there was no word on which companies received a warning letter, sources say it was sent out to six major companies involved in the industry of video gaming systems, cellular devices, and automobiles.

    On its press release published on its website, the FTC wrote that the letter consists of the concerns on the warranty statements given by the corresponding companies. These statements give out warnings to the consumers to only use specified parts or service providers so that their warranties can be kept intact.

    It’s important to point out that statements such as these are generally prohibited by the implemented Magnuson-Moss Warranty Act. This law governs consumer product warranties unless the warrantors provide services or product parts for free or receive an FTC waiver.

    These warranty statements are considered deceptive under the FTC Act:

    • This warranty shall not apply if this product . . . is used with products not sold or licensed by [company name].
    • The use of [company name] parts is required to keep your . . . manufacturer’s warranties and any extended warranties intact. 
    • This warranty does not apply if this product . . . has had the warranty seal on the [product] altered, defaced, or removed. 

    No matter how different the language is used in such statements, it still has some questionable provisions. And for FTC Bureau of Consumer Protection Acting Director, Thomas B. Pahl, these provisions are harmful for both consumers who are paying more for them and also the small businesses that are offering competing products and services.

    In its letter, the FTC staff requested that the promotional and warranty materials sent out by such companies are reviewed carefully. This is so that these materials do not imply or state that there is a conditional warranty covering the use of specific parts and services.

    The companies in question are also requested to revise its practices so that they are compliant with the implemented laws. After 30 days, the FTC staff will be reviewing the websites of these companies to ensure proper action has been taken. Failure to do so may lead to law enforcement action from the FTC.

    Source: FTC

  • Leave a Reply

    Your email address will not be published. Required fields are marked *