Harley-Davidson Restrictions on Parts and Repairs Class Action

Harley-Davidson motorcycles are not just popular, they also last a long time. The complaint for this class action alleges that “there is a vast and robust aftermarket for parts and accessories to repair and customize Harley-Davidson motorcycles.” But according to the complaint, Harley-Davidson Motor Company Group, LLC has tried to keep that market to itself, with a Limited Warranty that ties owners under warranty into using only its own parts and accessories.

The class for this action is all natural persons who bought a Harley-Davidson motorcycle in the US that is covered by a Harley-Davidson Limited Warranty, and who bought Harley-Davidson replacement parts or accessories, for use and not for resale, or who paid for servicing by an authorized Harley-Davidson dealer for that motorcycle during the two-year period covered by the Limited Warranty. A California subclass has also been defined for all natural persons who bought a Harley-Davidson motorcycle in California.

According to the complaint, Harley-Davidson has a “practice of selling motorcycles with conditional warranties that cover repairs only if the consumer has all services and repairs undertaken by an authorized Harley-Davidson dealer and uses only replacement parts and accessories from authorized Harley-Davidson manufacturers…”

This violates laws, such as the Magnuson-Moss Warranty Act (MMWA), the complaint alleges, in more than one way, because the company also does not give consumers access to a written warranty before the point of sale. Also, the complaint claims, the company does not provide a full and conspicuous disclosure of the terms and conditions of its Limited Warranty but “instructs its customers to consult with a Harley-Davidson dealer for full details.

The complaint suggests a reason for the company’s close hold on sales of parts and accessories. “In 2021,” the complaint alleges, “Harley-Davidson’s part and accessories segment … accounted for over 16% of [Harley-Davidson’s] total revenue, equating to over $740 million in revenue generated from that segment.”

Also in 2021, the complaint alleges, the Federal Trade Commission (FTC) decided to address repair restrictions as a priority. “Shortly thereafter,” the complaint alleges, “the FTC filed a complaint … alleging that Harley-Davidson unlawfully conditioned its written warranties to consumers on the use of Harley-Davidson branded parts and accessories and Harley-Davidson authorized services and failed to properly disclose all terms of its Limited Warranty in a single document to the consumer.”

The complaint alleges the FTC found that such terms are detrimental to consumers and competition.

Harley-Davidson settled with the FTC, which put out a final order and consent decree in October 2022. This consent decree, the complaint alleges, prohibits the company from continuing its practices. However, the complaint points out that the FTC does not have the authority to recover damages for consumers for Harley’s past behavior. The complaint claims that it therefore aims to have the company provide some compensation to consumers for their past overpayments for the use of Harley-Davidson’s parts, services, and accessories in the past.

Article Type: Lawsuit
Topic: Consumer
Tags: Tying Arrangement, Unjust Enrichment, Warranty