04/07/2010

Spring has finally arrived, and with it the obligation to get the yard back in shape. But this year consumers finally have a reason to be thankful for their lawnmower: a class action lawsuit settlement that entitles scores of people to a check and/or a warranty extension.

The settlement concerns a lawsuit, filed last May, contending that advertisements for over 20 lawnmower brands exaggerated the machines' horsepower. The complaint, filed in federal court in Wisconsin, claimed the defendant companies "defrauded the public" by "significantly overstating" the horsepower of the subject lawnmowers, and by "failing to disclose...[their] true, significantly lower horsepower."

Specifically, the complaint stated that the defendants sold "identical, but differently and misleadingly labeled, engines at different prices -- with higher prices for engines labeled with purported higher horsepower." In other words, the companies took two identical engines, slapped different labels on them, and sold them at significantly different prices.

The suit also claimed that several of the companies created a so-called "Power Labeling Task Force," a group that they used to plan and organize their conspiracy. The group held meetings "at various locations," and even kept minutes that were distributed once the task force had adjourned.

By discovering the task force, the plaintiffs were able to include a count for violation of the Racketeer Influenced and Corrupt Organizations Act (RICO). According to the complaint, the defendants' "repeated acts of mail and wire fraud" -- namely, mailing false and misleading advertisements -- rose "above mere fraud."

The suit concerns lawnmowers with the brand names Yard-Man, Cub Cadet, Honda, Bolens, Exmark, Deere, Sabre, Scotts, Toro, Yard Machines, Craftsman, Troy Bilt, Husqvarna, Poulan, Poulan PRO, Lawn-Boy, Weed Eater, White Outdoor, Snapper, Simplicity, Brute, and Murray. The suit also covers "numerous other brands" with engines manufactured by Briggs & Stratton, Tecumseh, Kawasaki, Honda or Kohler.

Under the settlement, class members who submit timely claim forms can receive $35 for every eligible walk-behind lawnmower they own, and $75 for every eligible ride-on mower. Consumers who own a Briggs & Stratton, Toro, Tecumseh, TecumsehPower, Kawasaki, or Kohler mower, which was under a manufacturer's warranty when purchased, can receive a one-year warranty extension.

Additionally, MTD, Kawasaki, Kohler, Sears, Deere, Tecumseh, Briggs & Stratton, Toro, Electrolux, and Husqvarna have agreed to begin using a "new uniform standard" to measure horsepower.

A final approval hearing is scheduled for June 22. Class members who wish to object or opt out of the class must do so by June 4. Claim forms for the above-detailed cash benefits are due by August 31. Consumers have one year following final approval to submit claim forms for a warranty extension. Additional information is available at the official settlement website.

In addition to the RICO claim, the complaint alleged unjust enrichment, antitrust violations, conspiracy, and violations of state consumer protection laws.