State Settles Lawnmower Horsepower Case

HARTFORD (CN) - Briggs & Stratton and MTD Products will pay Connecticut $250,000 and offer $300 to every customer who bought a power lawnmower that was falsely labeled as having a 18.5 horsepower engine, though the true horsepower was only 16, the state announced Monday. These defendants, and others, still face class actions in other states that make wider claims about horsepower fraud.

Connecticut Attorney General Richard Blumenthal said the models involved in the state's settlement include "Yard Man" mowers sold at Lechmere and Montgomery Ward stores in Connecticut in 1996 and 1997.

Blumenthal said in a press release that the defendants "clipped consumers, using phony labels to deliberately deceive them about tractor horsepower. Facing an engine shortage, the companies mislabeled tractors, misleading consumers into believing they were buying a more powerful product. Instead of the promised 18.5 horsepower, consumers got 16".

Briggs & Stratton made the engines, and MTD made the tractors. Blumenthal said 3,948 mislabeled tractors were sold nationwide.

This settlement apparently will not resolve the wider claims made in other class actions. Here is Courthouse News' May 23 story about the first recent class action that claimed major manufacturers deliberately misled consumers about horsepower ratings. A similar class action was filed in San Francisco Federal Court.

Class Alleges Widespread Conspiracy

In Lawnmower Horsepower Ratings

CAMDEN, N.J. (CN) - For more than a decade, Sears Roebuck and the major manufacturers of power lawnmowers - including Deere, Briggs & Stratton, Toro, Kawasaki and Honda - have lied to consumers about the machines' horsepower to justify higher prices, according to a federal class action.

The complaint states: "For more than a decade, Defendants have lied to consumers by overstating the horsepower of lawn mower engines. In advertising and selling their lawn mowers and lawn mower engines, Defendants have defrauded the public by: 1) misrepresenting and significantly overstating the horsepower produced by such products; 2) concealing, suppressing and failing to disclose material information, including the true, significantly lower horsepower of Defendants' products; and 3) falsely advertising and selling lawn mowers containing identical engines that produce the same horsepower as different products with different horsepower labels or ratings at different prices - higher prices for falsely represented higher horsepower - while concealing, suppressing and failing to disclose material information, including the facts that the engines are identical and the true, significantly lower horsepower of the lawn mowers. Plaintiffs assert claims for violations of the New Jersey Consumer Fraud Act, as well as common law unjust enrichment and conspiracy."

The defendants sell nearly 6 million lawnmowers a year in the United States, the complaint states.

It claims that the nine defendant manufacturers are all members of a "'Power Labeling Task Force,' which provides Defendants the means, opportunity and cover to meet, discuss, conspire and further their fraudulent horsepower misrepresentations. ...

"In or about 2001, the Power Labeling Task Force members met and discussed various means by which to conceal horsepower fraud and misrepresent horsepower to the consuming public. One suggestion was to put a 'disclaimer' - a statement containing misleading information on horsepower issues designed to confuse the consuming public - on the Outdoor Power Equipment Institute, ('OPEI,' an otherwise legitimate organization) Web site. [Parenthetical remarks in complaint.] The disclaimer was titled 'Understanding Horsepower' and includes misleading information on horsepower issues.

"On July 10, 2001, William G. Harley and Patrick W. Curtiss of the OPEI mailed to Defendants a memorandum listing the uniform means by which the Power Labeling Task Force members intended to misrepresent horsepower testing procedures and to conceal Defendants' fraudulent horsepower labeling practices from consumers.

"The members of the Power Labeling Task Force, which are also members of the OPEI, voted in favor of the proposal, and the OPEI created the Web page containing misleading horsepower information. The Web page continues to be on the OPEI's Web site.

"Defendants' conduct rises above mere fraud. Not only do Defendants lie about the horsepower of their lawn mowers and lawn mower engines, Defendants conspired to conceal these lies and deceive the consuming public by using the Web site of a legitimate entity."

Plaintiffs claim the defendants created a "labeling standard" called "SAE J1940" to "conceal horsepower fraud. This labeling standard was an attempt to give Defendants a purportedly legitimate reason for labeling their engines with a horsepower representation different from what their test results achieved."

They claim the SAE standard "allowed for a 'fudge factor' of up to 15% to be added to horsepower labels."

In 1990, the defendants compounded the fraud by adopting a "gross horsepower" standard, "SAE J1995," which uses "the theoretical horsepower than an engine could achieve under ideal laboratory conditions with all of the legally required accessories removed from the engine - such as the air filter and exhaust mechanism," the complaint states. Before this, the defendants had used the more honest net horsepower, it states.

Here are the defendants: Deere & Co., Tecumseh Products Co., Briggs & Stratton Corp., Kawasaki Motors Corp. USA., MTD Products, The Toro Co., American Honda Motor Co., Electrolux Home Products, The Kohler Co., Platinum Equity LLC, and Husqvarna Outdoor Products.

Plaintiffs lead counsel is Lisa Rodriguez with Trujillo Rodriguez & Richards of Haddonfield, N.J.

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