23.7.5 Magnuson-Moss Warranty Act.

• Jurisdiction: Arizona

23.7.5 Magnuson-Moss Warranty Act. Congress enacted the Magnuson- Moss Warranty Act (MMWA) in 1975 in response to complaints “from irate owners of motor vehicles complaining that automobile manufacturers and dealers were not performing in accordance with the warranties on their automobiles.”⁷⁵ The purpose of the Warranty Act is “to prevent warranty deception.”⁷⁶ The Act requires conspicuous disclosure of the “terms and conditions” of warranties “in simple and readily understood language.”⁷⁷ And, “[t]o enforce its requirements, the Act permits ‘a consumer who is damaged by the failure of a supplier, warrantor, or service contractor to comply with any obligation under this chapter, or under a written warranty, implied warranty, or service contract’ to sue warrantors for damages and other relief in any court of competent jurisdiction.”⁷⁸ To bring a cause of action under the Warranty Act, a person must be a consumer of a consumer product and have a written warranty, implied warranty, or service contract, as those terms are defined by the Warranty Act. The Warranty Act defines “consumer product” as “any tangible personal property which is distributed in commerce and which is normally used for personal, family or household purposes.”⁷⁹

The Act calls for the application of state written and implied warranty law rather than the creation of additional federal law, except in specific instances in which the Act expressly prescribes a regulating rule.⁸⁰ The MMWA also codifies various state law claims related to consumer product warranties, but it does not create any new substantive federal law for consumer product warranties.⁸¹ The provisions of the MMWA that create a private cause of action permit a “consumer” to sue a warrantor for (1) a violation of the substantive provisions of the Act, (2) a breach of a written warranty, (3) a breach of an implied warranty, or (4) a breach of a service contract.⁸² Although the MMWA allows a consumer to bring various causes of action related to a consumer product warranty, “state warranty law lies at the base of all warranty claims under Magnuson-Moss.”⁸³

The MMWA does not require a manufacturer to supply a warranty with the sale of a consumer product.⁸⁴ However, it does require that a warrantor who supplies a warranty costing the consumer more than ten dollars at retail to comply with the disclosure requirements set forth in 15 U.S.C. §§ 2302 ; 2303 . The Federal Trade Commission has authority to prescribe regulations addressing and enforcing disclosure requirements.⁸⁵

The MMWA provides that a warranty must clearly and conspicuously designate its warranty as either a “full (statement of duration) warranty” or a “limited warranty.”⁸⁶ When a warrantor has designated a warranty as a “full warranty,” it incorporates the “Federal Minimum Standards” that are set forth in 15 U.S.C. § 2304 . Under the Federal Minimum Standards, the warrantor must (1) remedy the product within a reasonable time, without charge when there is a defect, malfunction or failure to conform to the written warranty; (2) may not limit the duration of any implied warranty on the consumer product; (3) may not exclude or limit consequential damages for a breach of the written warranty or implied warranty unless the limitation is conspicuously displayed on the face of the warranty; and (4) if the product contains a defect or malfunction...