Whirlpool Threatens To Leave Energy Star Program If Class-Action Suits Continue

(bluwmongoose)

When consumers purchase a big-ticket item with hopes that it will make their home more energy-efficient, and the product doesn’t live up to its promises, should there be an option for redress? Newly introduced legislation essentially says “no.” Oh, and if that bill doesn’t pass, one manufacturer say it will say “so long” to the Energy Star program all together.

According to the New York Times, a slew of class-action suits that materialized after a government report found many consumer products carrying the Energy Star label weren’t actually deserving of the title has some manufacturers and their backers fighting back.

The proposed legislation, introduced by Ohio Rep. Robert Latta, would eliminate consumers’ option to file class-action lawsuits against the companies that manufacture the products, so long as the Environmental Protection Agency came up with a remedy for products that did not live up to their billing. One possible remedy: reimbursing consumers.

Additionally, Whirlpool is threatening to withdraw from the Energy Star program if such lawsuits continue to be permitted.

The bill has a strong backing by manufacturers and others involved in the Alliance to Save Energy group, which counts LG Electronics as a founding member and Whirlpool as an associate member.

Although Whirlpool did not provide comment to the Times, the industry’s trade association, the Association of Home Appliance Manufacturers, says there are other safeguards in place for consumers that offer alternatives to class-action suits.

“EPA already has sufficient authority to protect consumers and make the determination of whether compensation is appropriate,” the group tells the Times.

Still, consumer advocates, such as our colleagues at Consumers Union, say the proposed bill is anti-consumer.

“Consumers need that backstop of the courts to get redress.” Class-action suits, she said, are appropriate in cases where “it’s lots of small injuries,” Shannon Baker-Branstetter, a specialist on clean energy and climate change at CU tells the Times.

She says class-action suits are appropriate in cases where there are lots of small injuries, such as an appliance that will use a few extra dollars’ worth of electricity each year.

The Energy Star program was created in 1992 as a way to identify efficiency among products such as refrigerators, washing machines, televisions and light bulbs.

Back in 2010, congressional auditors tested the Energy Star system by submitting laughable applications to apply for the label. As it turns out, the system wasn’t exactly on-par, eventually approving several products including a gas-powered alarm clock.

Congress eventually ordered changes to the program and now products must be checked by an independent, certified laboratory. Additionally,the products are subject to spot checks on units pulled from store shelves.

Since then, several appliances that were once labeled with the Energy Star logo have been disqualified. As a result LG, Samsung and Whirlpool have faced class-action suits.

While the label may draw consumers to products – an EPA survey found that the logo influenced 91% of consumers to make a purchase – it is a voluntary program.

Whirlpool is arguing that such suits are pre-empted by the federal government.

According to the Times, a judge in New Jersey threw out one class-action suit brought under Energy Star because the company had already paid compensation to consumers.

Big thanks to reader Jo for sending a tip about this issue to Consumerist. Send your tips to tips@consumerist.com.

Whirlpool Wants Congress to Ban Class-Action Suits Tied to Energy Star Program [New York Times]

by Ashlee Kieler via Consumerist