You should pay special attention to any guarantees or any product warranties your business makes. Many businesses like to offer some type of “satisfaction” or “money-back” guarantee or free trial. Similarly, you may or may not want to include specific, express warranties regarding anything you sell. Generally speaking, the law does not require you to give any written warranties to your customers other than providing what you say you will!

The law does not require that you provide any money back guarantees or other guarantees. But, if you do make any guarantees or warranties, the basic tenets of FTC and state advertising law need to be followed. Making guarantees or warranties are just like any other advertisement or claim. You can’t refuse to honor or follow through with any guarantee or warranty or misrepresent the nature of any guarantee or express warranty, as stated on your website, terms of sale or elsewhere. Do what you say you will on your website without limitations.

I should point out that you can make written warranties or guaranties informally by any statement or advertisement contained on your website. So, you should be careful not to do so if you don’t intend to provide any express warranties. Warranties can be made through promotional material, brochures, proposals, and ads. They can arise through verbal statements and do not have to include the words warranty or guarantee. Generally any representation of fact or promise, description of the goods, or use of samples or models by the seller that indicate how the product can be used or some other characteristic or quality will create an express warranty. A statement about the value of the goods or a statement that is only the seller’s opinion or commendation of the goods does not create a warranty.

Also, when a product is sold, there are certain implied warranties that occur by law automatically (unless any implied warranties are waived). If you do, you must follow the FTC laws, state laws, the Uniform Commercial Code and the Magnuson-Moss Warranty Act. Generally, express warranties should be in writing and made before the purchase and should be clearly stated in your product purchase agreement. Deceptive acts under the FTC rules can be pretty broad. If the language of any of your ads, claims, guarantees or warranties would cause the reasonable consumer to have some expectation, it needs to be met by your business. If you make any guarantee or warranty misleading, this could violate both federal and state deception laws.

 

Warranty & Guaranty Guidelines:

  • If you use the terms “satisfaction guaranteed” or “money back guarantee” on your website, your business must provide any customers with a refund of the full purchase price upon request. You can provide some mechanism for processing refunds and make your customers go through that process. But, it can’t be burdensome or unreasonably and you should always refund the purchase price immediately after the customer has requested the refund;

  • Don’t fail to mention shipping and handling costs will or will not be refunded when providing any type of guarantee. If your business does not refund shipping and handling charges, you need to disclose this clearly and prominently. You should follow the same principles for this type of disclosure as you would any other ad or claim;

  • Any advertisement that mentions a full warranty relating to a consumer product (personal and household good) should disclose in a clear, easily understandable, and prominent statement: (1) that the consumer can review a written copy of the guarantee or warranty before they purchase the product and (2) how and where the consumer can obtain a written copy of this warranty;

  • Any warranty (full or limited) must clearly disclose all material limitations and conditions placed on the guarantee, such as a requirement that the product be unopened, returned in its original packaging, or returned within a certain number of days;

  • Like any other disclosure, any product warranty or guarantee must be clear, conspicuous and easy to understand. Do not try to conceal or mislead the nature of any limitation on any warranties your business may provide;

  • Inform your customers how to get a copy of any warranty your business provides before they purchase any products;

  • If you use the words “lifetime warranty,” “guaranteed for life,” or similar words you need to clearly indicate “the life” that your claim is referring to. You should clarify if “lifetime” means for the life of the product or the consumer;

  • Always Honor Your Warranties! Under state laws, it can be an unfair or deceptive act or practice to fail to honor a warranty (not to mention the wrong thing to do).