Volume 9, Issue 3 - March 2008
Consumers Focus too Much on the Wrong Kind of
With the influx of green products, paves yet another way for lawyers and consumers to target door and window manufacturers in legal cases. It is important to learn how to protect yourself from these, and other similar, claims.
If you don’t think this is happening, think again.
I received a call recently from a representative from the Lights Out Electrical Company, a family-owned window manufacturer. The company was under attack from Duey, Cheatem and Howe, a law firm with a reputation of putting manufacturers out of business. Mr. Shocked, the CEO of the window company, exclaimed, “I NEED YOUR HELP!!” After listening to several minutes of stressful venting, I figured out that a lawsuit was filed on behalf of a large group of homeowners looking for a huge chunk of change. Cash. The suit alleged the window company breached its warranty, committed fraud and several other dreadful claims. Specifically, the suit claimed that Lights Out failed to meet its promise to provide “green” windows. “Green?” I asked. “There’s a problem with the color of the windows?”
“No!,” stressed the CEO. “Those legal vultures say our windows don’t meet code!”
“There’s a code for the color of windows?” my confusion mounting.
Exacerbated, the deflated CEO sighed, “they say our windows don’t live up to their energy ratings. We say the gas we put between the two lites of glass lower energy bills by up to 28 percent. They say that isn’t true.”
“Oh! That green,” I said, finally understanding. My thoughts wandered for a moment recalling all of the window manufacturer websites, sales literature and warranties I have reviewed, analyzed and modified over the years. I asked, “Do they save the homeowners up to 28 percent off of their utility bills?”
“Do you know for sure?” I asked.
“They did in the lab. We wouldn’t have any idea after the windows have been installed in a homeowner’s house for a while. Maybe the gas escapes. It might depend on where the windows are shipped. There are many factors involved. Our sales staff didn’t mean any harm in making those promises in our sales literature. They want to maximize their sales and, as you know, it’s a dog-eat-dog world out there.”
Now I understood. The tension between the folks trying to sell as many windows as possible while competing against a ton of other manufacturers and the folks protecting the assets of Lights Out was exposed. Focusing too much on the green dollars rather than making sure products meet the green promises made to homeowners is a recipe for disaster.
We all know the window industry is competitive. Margins are low. Volume is critical. Everyone shoots for the next big score. Much of the competition begins in the showroom. As homeowners become more informed and educated about fenestration products, they become savvier with their selections. The sales warfare has increased the importance of the labels placed upon new windows.
Labels are not simply stickers that need to be taken off before hanging the drapes. Consumers are relying on the promises made. Consumers are paying attention. They want to save money on their utility bills. They want to get tax breaks. Resources are readily available to homeowners to help them select windows for their homes.
H.R. 3221, passed by the U.S. House of Representatives recently, calling for a 50-percent reduction in energy use in residential buildings by 2020, underscores the aggressive movement toward green buildings and green products (see related story in January 2008 DWM, page 22).
After figuring out a strategy to respond to the lawsuit against Lights Out (a subject to detail in another article), I calmed Mr. Shocked by explaining how to help avoid the problem in the future.
“Build what you say you build. Know that any description that is part of the sales pitch, including NFRC labels, U-Factor, solar heat gain coefficient, visible light transmittance, etc., can express a warranty or a promise, whether intended or not. Have everything you say, written and spoken, analyzed and modified to avoid making promises you can’t keep. You must make sure your brochures, websites, billboards, ads, the name of your products and the statements made by your sales staff all match up with what your windows actually deliver to the homeowner.”
I further explained, “Ignoring one piece of the puzzle risks everything. Duey, Cheatem and Howe will use every legal theory available to help make the best case they can for their homeowner clients. The theories at their disposal include breach of warranty, negligence, product liability, fraud and consumer protection claims. The money claimed will not just be money to fix the problem. It will not be money to simply pay the homeowner for extra energy bill costs. The money claimed will include punitive damages, not likely covered by insurance nor by bankruptcy. In other words, do not ignore a single piece of the puzzle. Make sure you know how your products are described, including energy ratings, to the public.”
“Thank you so much! I needed this eye-opening conversation,” Mr. Shocked said with gratitude.
“Any time,” I said. “Now you can focus on the right kind of green making sure your sales staff, your brochures, your labels and your products all match up to meet the ‘green’ needs of your customers. The green dollars will follow. Taking the right kind of precautions now will help you keep the green dollars rather than turning them over to homeowners’ lawyers.” And with that, Mr. Shocked was off to set up a meeting with his sales staff.
Charles A. Gentry is an attorney at law for Carson & Coil, P.C., in Jefferson City, Mo. You may e-mail him at firstname.lastname@example.org