- In 1974, Congress passed the Magnuson-Moss Warranty Act, designed to protect consumers form purchases that were defective. The Act, nicknamed the Lemon Law because it forced manufacturers and their sellers to stand behind the warranties offered with the sale of their product, had an immediate impact on raising the quality of many consumer items.
- Although most people associate the Lemon Law with the purchase of an automobile, it actually covers all consumer purchases of a non-perishable item with a value of $15 or more. Each state interprets the law differently and adds additional requirements (see Resources below).
- The time frame governing the Lemon Law depends on the individual warranty of the item in question. With a new automobile, a 3-year warranty is common, but if a car buyer purchases an extended warranty, he may be able to use the Lemon Law to his advantage for the extended coverage if he meets certain conditions. For instance, some states require the buyer seek a remedy from the seller a minimum number of times before the law forces the seller to replace the defective item.
- The Lemon Law does not apply to problems associated with consumer neglect or mishandling of the item. If a car buyer abuses a vehicle and an independent consultant determines evidence of such, the owner will not be covered under the Lemon Law.
- A consumer faced with a defective product that the seller cannot or will not fix can file a legal claim against the seller or the manufacturer. If the consumer prevails, the judge may also order the defendant to pay for the buyer's legal fees in addition to paying the buyer a monetary amount to replace the defective item.
