JB Hi-Fi Ltd faces a class action lawsuit from Maurice Blackburn, accusing the retailer of selling "junk" extended warranties to customers that offer little to no additional value over the free rights provided under Australian Consumer Law.
The lawsuit, filed in the Victorian Supreme Court, seeks refunds for consumers who purchased warranty policies, alleging that JB Hi-Fi engaged in misleading or deceptive conduct in their sale.
It focuses on the extended warranties, often sold as "extended care", "customer care", or "extra care" plans, which, according to the lawsuit, have been marketed by JB Hi-Fi since 2011.
Already protected by law
Maurice Blackburn principal lawyer Miranda Nagy denounced the warranties as superfluous, stating they fail to significantly enhance the robust consumer rights for repair, replacement or refund already guaranteed by law.
Nagy highlighted the redundancy of these warranties, saying: “What we're alleging in the class action is that JB Hi-Fi has been selling extended warranties that essentially offer Australian consumers the same thing as what they already get for free under the Australian Consumer Law.”
Central to the lawsuit are the "consumer guarantees" inherent in Australian Consumer Law. These guarantees include rights to repair, replacement or refunds for products that fail to meet acceptable quality standards, including safety, durability and performance expectations.
Nagy criticised the limited duration of JB Hi-Fi's warranties, often not exceeding six years, as insufficient for high-value products like a $2,000 fridge. She argued that the remedies under Australian Consumer Law were likely to outlast these warranties.
JB Hi-Fi, when approached for a comment, declined to respond. The company's warranty brochures claim additional benefits not covered by consumer law, including certainty on coverage period and remedies. However, Maurice Blackburn's case alleges that these brochures often omit crucial comparisons between basic consumer law protections and the extended warranty benefits.
The class action potentially involves hundreds of thousands of customers and millions of dollars spent on these extended warranties.
The case will delve into the specifics of consumer rights, the obligations of businesses under Australian Consumer Law and the alleged discrepancies in JB Hi-Fi's marketing of their extended warranties.
JB Hi-Fi asserts that it will vigorously defend the proceedings.