Federal-Mogul Motorparts must back up brake claims

Federal-Mogul Motorparts settled a Federal Trade Commission administrative complaint that alleged it made unfounded claims that its aftermarket Wagner OEX brake pads could stop a vehicle in a shorter distance than its competitors' brake pads.

The resulting consent order bans Federal-Mogul from making the claim unless it produces verifiable scientific evidence.

"Manufacturers of aftermarket auto parts must not make claims about the performance of their products without adequate substantiation," said Andrew Smith, director of the FTC's Bureau of Consumer Protection. "We did not challenge the brake pads as unsafe. Rather, we challenged the manufacturer for making very specific performance claims without the science to back those claims up, and that's deceptive and illegal."

The FTC issues an administrative complaint when it believes the law has been or is being violated and that a proceeding is in the public interest. When the commission issues a consent order on a final basis, it carries the force of law with respect to future actions.

In its complaint, the FTC said that since 2015 Federal-Mogul had marketed the brake pads — used mostly on pickups, crossovers and SUVs — as being able to stop up to 50 feet sooner than their competitors.

The settlement prohibits Federal-Mogul "from making any claims about the braking benefits, performance, or efficacy of any covered brake pads, unless the representation is not misleading and, at the time it is made, is supported by competent and reliable scientific evidence."

This applies not only to the Wagner OEX pads, but also any Federal-Mogul branded or marketed aftermarket brake pads, including any third-party branded aftermarket pads for which the company provides marketing materials.

An Oregon dealership that hired 16- and 17-year-olds as lot attendants has paid $27,451 to settle a complaint it violated federal child labor laws.

The case arose from a U.S. Labor Department investigation of Landmark Ford-Lincoln in the Portland area between 2017 and 2019.

The store generally employed one or two minors at a time during that period, dealership President Jim Corliss told Fixed Ops Journal.

Corliss said the infractions were not major and that the store has asked the Labor Department for a "significant reduction" in the penalty and to have some of the money returned.

In announcing the settlement Feb. 28, the department said the minors were "tasked with occupations prohibited under the Fair Labor Standards Act's youth employment provisions, such as driving vehicles on public roadways and loading and operating trash compactors."

Corliss said they crossed just 50 to 70 feet of public street when moving vehicles to a parking lot used for rental cars. He said the trash compactor violation involved letting minors push the button that turns on the machinery.

The Labor Department said a young employee who was riding in the open bed of a shop truck was injured when the vehicle suddenly accelerated. He filed a workers' compensation claim.

"The law prohibits minors from riding outside the cab of a vehicle in this manner," the department said. Corliss said Landmark Ford-Lincoln has the same policy.

Now, Corliss said, "We've educated everyone. We have every minor sign off saying they won't take a car across a public street or push a button."

The announcement didn't include details, such as the origin of the investigation or the number of minors employed by the dealership. A spokesman said the department doesn't reveal the reasons for an investigation, saying: "All complaints are confidential. The name of the worker and the nature of the complaint are not disclosable."

The court giveth, and the court taketh away.

A service customer won a $127.97 Canadian ($90.45) judgment against a Scarborough, Ontario, dealership that mistakenly failed to give him the promotional price for a spring maintenance package. But it was a Pyrrhic victory for Arnold Miguel because a small claims judge also ordered him to pay Scarborough Mitsubishi CA $2,000 ($1,414) in court costs because his demand for punitive damages was unjustified.

When Miguel brought his vehicle to the store in March 2017 for an oil and tire change, he saw a promotional ad for a CA $169.95 ($121.59) spring maintenance package and asked for it, the decision said. But the store overcharged him.

He pointed out the discrepancy to the store's management, which offered to reimburse the overcharge. But rather than accept the money, he sued, alleging that the store deliberately made "false, misleading and deceptive representations" and seeking a full refund plus CA $24,000 ($16,963) in punitive damages.

At trial, the judge found that the overcharge was unintentional, awarding Miguel the CA $127.97 differential and Scarborough Mitsubishi the CA $2,000 in court costs.

Justice Lisa Favreau of the Ontario Superior Court of Justice upheld the awards in a Feb. 12 decision.

Miguel filed his appeal too late, Favreau said. Beyond that, his appeal had no merit and there was no evidence the overcharge was deliberate, she said. Two dealership employees testified that the store erroneously overcharged Miguel, she said, adding that the trial judge accepted this explanation and deemed both witnesses as credible.

She found the CA $2,000 award to be reasonable and proper because of the store's reimbursement offer before trial.

A former senior finance manager can pursue breach-of-contract and labor law claims against a New York City Mercedes-Benz store, a federal judge has ruled.

Timothy Jones, who worked at Mercedes-Benz Manhattan from 2013 to 2015, alleges the store failed to honor commission and compensation provisions of his offer letter, according to the March 25 decision by U.S. District Judge Andrew Carter Jr. The suit also asserts that his supervisor created a hostile work environment because Jones had reported suspicions of fraud and other misconduct.

The judge rejected the store's bid to dismiss allegations that it violated a New York law that requires employers to provide certain wage and pay stub information to their employees. He tossed out an unjust enrichment claim, however.