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Consumer Protection — Lemon Law


Consumer Protection — Lemon Law


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 U.S. Court of Appeals For the Seventh Circuit


Consumer Protection — Lemon Law

A seller’s acceptance of responsibility for paying off a buyer’s lien is not sufficient to comply with the Lemon Law.

“PACCAR contends that it carried that burden by timely tendering the $114,043.61 check to JM Leasing and accepting responsibility for paying off (but not actually paying off) JM Leasing’s lien. We do not believe that the Wisconsin Supreme Court would agree. That court begins and ends its statutory analyses with the text of a statute when the plain meaning is clear. Tammi v. Porsche Cars N. Am., Inc., 768 N.W.2d 783, 791 (Wis. 2009). The plain text of the Lemon Law obligates manufacturers like PACCAR to ‘refund to the consumer and to any holder of a perfected security interest in the consumer’s motor vehicle, as their interest may appear, the full purchase price plus any sales tax, finance charge, amount paid by the consumer at the point of sale and collateral costs, less a reasonable allowance for use.’ Wis. Stat. § 218.0171(2)(b)2.b. (emphases added). This language requires manufacturers to actually refund the money due within 30 days, not simply to agree to do so. Moreover, it requires them to refund the money directly to the holder of the security interest rather than leaving the consumer ‘to sort it out with the lender.’ Marquez v. Mercedes-Benz USA, LLC, 751 N.W.2d 859, 862–63 (Wis. Ct. App. 2008); cf. Estate of Riley ex rel. Riley v. Ford Motor Co., 635 N.W.2d 635, 638 (Wis. Ct. App. 2001) (‘[D]elivery of a refund check to a dealership’s sales manager is not the equivalent of a timely delivery of a refund check to the consumer.’). PACCAR points to Herzberg v. Ford Motor Company, 626 N.W.2d 67, 72 (Wis. Ct. App. 2001), for the proposition that a party that ‘stands ready’ to comply with its obligations under the Lemon Law satisfies its statutory duties. In Herzberg, however, the party that ‘stood ready’ to comply with its obligations was the consumer. In light of the Wisconsin Supreme Court’s determination that the manufacturer must bear the burden of providing the refund, we cannot conclude that a manufacturer’s assurance that it will do so is sufficient to fulfill its obligation under the Lemon Law. See Church v. Chrysler Corp., 585 N.W.2d 685, 688 (Wis. Ct. App. 1998) (stating that the Lemon Law ‘clearly requires that the manufacturer issue a refund within thirty days of the consumer’s offer to transfer title’).”


13-3773 James Michael Leasing Co, LLC, v. PACCAR, Inc.

Appeal from the United States District Court for the Eastern District of Wisconsin, Adelman, J., Dow, J.

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