The right to repair (R2R) is the idea that consumers who buy a product should be able to repair that product without limitations. It is a challenge to sellers who require use of authorized repair services or parts. Sellers and industry groups counter that repair restrictions are sometimes necessary to ensure safety and protect intellectual property. In 2001, the Federal Trade Commission (FTC) announced renewed interest in repair restrictions in its “Nixing the Fix” report.
R2R is both a consumer protection and antitrust issue. There are non-antitrust statutes—Magnuson-Moss and numerous state laws—touching on R2R. But R2R theories also borrow heavily from antitrust concepts, such as the idea that there are service and parts aftermarkets distinct from the foremarket for the sale of the original product.
Until recently, R2R compliance was mostly just a matter of following the anti-tying provision of the Magnuson-Moss Warranty Act. That provision makes it illegal to condition a warranty “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.” A company cannot void a warranty automatically simply because a consumer uses unauthorized parts or services.
There is an increasing risk of enforcers scrutinizing warranty provisions. The FTC in 2022 brought enforcement actions against Weber, Harley-Davidson, and MWE Investments for alleged Magnuson-Moss violations. The FTC resolved these cases through consent orders prohibiting any statement that a warranty will be voided by use of unauthorized parts or services.
What this means is that companies must look closely at any warranty restrictions. Magnuson-Moss does allow a seller to state that a warranty does not cover damage caused by unauthorized parts or services. If I ruin my phone by trying to fix it with a paper clip, the warranty need not cover that damage. My use of unauthorized parts would have caused the damage. In practice, however, it can sometimes be difficult to differentiate between acceptable and unacceptable warranty limitations.
The Supreme Court’s decision in Eastman Kodak v. Image Technical Services, Inc., 504 U.S. 451 (1992), is another pillar of R2R. Antitrust lawyers used to talk about “Kodak claims” when referring to Sherman Act claims based on repair restrictions. Defense-side antitrust lawyers frequently cited Kodak as support for the principle that pre-purchase disclosure of repair restrictions barred antitrust claims based on those restrictions. Now, however, there is renewed debate about what Kodak means. The Department of Justice filed an amicus brief in February 2023, contending that Kodak does not bless all disclosed repair restrictions. And the court in that case (a Northern District of Illinois action against John Deere) denied a motion for judgment on the pleadings, finding that Kodak allowed the case to go forward because plaintiffs alleged that John Deere had misled purchasers about repair restrictions. But, just a few days earlier in November 2023, a court in the Northern District of California granted a motion to dismiss in a R2R case against Tesla on the ground that Tesla had adequately disclosed repair restrictions.
What this means is that litigants, judges, and enforcers all continue to see Kodak as important and so the question of how companies communicate about repair restrictions is more relevant than ever. Manufacturers therefore must consider how they talk to customers about repair restrictions. They must disclose any limitations (Tesla) and must not overstate a consumer’s access to repair options (John Deere).
There will be more cases and enforcement actions and also more legislation. Many states have passed R2R legislation, most notably Massachusetts, which passed aggressive automobile-specific legislation giving drivers and repair shops access to almost all mechanical data. There is ongoing litigation about the scope of that law, but there is no doubt that the move in Massachusetts will be towards more consumer access. Other states pushing on R2R are Colorado, which passed an agriculture R2R law, and California, which passed an electronics R2R law. There also are many other state and federal R2R laws pending.
