The FTC says that is has put six major companies on notice for the use of these stickers (among other practices), and say that they violate the Magnuson-Moss Warranty Act (MMWA) that provides guidelines for consumer product warranties. The MMWA specifically states:
No warrantor of a consumer product may condition his written or implied warranty of such product on the consumer’s using, in connection with such product, any article or service (other than article or service provided without charge under the terms of the warranty) which is identified by brand, trade, or corporate name.
The FTC goes on to say that of the six companies that it has warned, they include automobile, smartphone and video game console manufacturers. With regards to game consoles, both Microsoft and Sony are guilty of liberally applying the stickers on their Xbox One and PlayStation 4 in an effort to deny warranty repair claims if the seal is broken.The regulatory agency provided the following examples of illegal language that manufacturers have used to shirk their responsibilities when it comes to covering warranty repairs:
- The use of [company name] parts is required to keep your... manufacturer’s warranties and any extended warranties intact.
- This warranty shall not apply if this product... is used with products not sold or licensed by [company name].
- This warranty does not apply if this product... has had the warranty seal on the [product] altered, defaced, or removed.
“Provisions that tie warranty coverage to the use of particular products or services harm both consumers who pay more for them as well as the small businesses who offer competing products and services,” added Thomas B. Pahl, who serves as FTC Acting Director for the Bureau of Consumer Protection.
Interestingly, this action by the FTC comes just after we reported that Apple began bricking iPhone 8 devices that had their displays replaced by third-party repair shops. iPhone 8 owners had fully functioning devices (after third-party repairs were performed) until Apple disabled touch screen functionality with the iOS 11.3 update. Without touch support, an iPhone is effectively an overpriced paperweight. It is not known if Apple is among the companies that the FTC has reached out to over unfair warranty practices.
The six companies in question have been contacted by the FTC and asked to review their promotional and warranty materials to ensure that they are not violating the MMWA. The companies have 30 days to comply or they may face law enforcement action for any violations.