GNYADA 2019 Membership Directory & Services Guide

Some states require implied warranties in any vehicle sale. Other states permit “as is” sales of used cars. Used car warranties and the availability of a manufacturer’s warranty must be disclosed in the Used Car Buyer’s Guide discussed earlier in this Chapter. In 2015, President Obama signed the E-Warranty Act which does away with a requirement that has been on the books since passage of the Magnuson-Moss Warranty Act of 1975, which compelled manufacturers to include warranty terms on a single printed document on or within packaging of products costing more than $15. The E-Warranty Act now permits, but does not compel, manufacturers to avoid the requirement by directing consumers to their websites to find the terms and conditions of their consumer warranties. Pursuant to the FTC’s rules implementing the E-Warranty Act, which took effect October 17, 2016, if a warrantor or seller opts to post warranty terms electronically, the warrantor or seller must: (1) provide consumers the Internet address of the website where the warranty terms can be reviewed; (2) provide a non-Internet based method, such as a phone number or mailing address, for consumers to request the warranty terms; upon request, the warrantor must provide the warranty terms promptly and free of charge; (3) ensure that all required warranty terms are posted in a clear and conspicuous manner and that any limitation on implied warranties appears in close proximity to the location where the text of the warranty terms begin; and (4) ensure that warranty terms remain accessible to the consumer on the warrantor’s website. FTC Warranty Rules Two additional FTC rules, the Consumer Product Warranty Rule (Warranty Rule) and the Rule Governing Pre- Sale Availability of Written Warranty Terms (Pre-Sale Availability Rule), specify language for warranties, require that warranties be displayed in close proximity to the vehicle, and the full warranty terms be made available to consumers upon request before they buy. State laws, such as the California and Minnesota Car Buyer’s Bill of Rights, provide minimum requirements for dealers to be able to use the term “certified” (or any similar term) in connection with a used car sale, and require other warranty and used car disclosures as well. FTC Endorsement and Testimonial Guidelines In 2009, the FTC issued revised guidelines on the use of endorsements and testimonials in advertising. The guidelines include the following: • There are several kinds of endorsers, including experts providing their expert opinions about the advertised product, consumers relating their experiences with the product (commonly referred to as “testimonials”), and organizations that may grant some sort of certification or approval. On the other hand, individuals who are merely spokespersons and are not purporting to provide their own opinions or experiences are not covered by the guidelines. Nor are bloggers or others who go on reviewwebsites and provide their opinions, so long as they are not connected in any way with the advertiser. • Endorsements must reflect the honest opinions, beliefs, or experiences of the endorser. Any claims made by the endorser beyond this must be true and substantiated. In other words, if the claim would have been deceptive if made directly by the advertiser, it is deceptive when made by the endorser. • Endorsements may not be presented out of context or reworded in a way that distorts the endorser’s opinions or experiences. If the endorser is presented as a user of the product, he or she must have actually used it.

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PG 182