PC Lemon Laws

New laws in the works may help you if your new PC turns out to be a lemon.

Frank Thorsberg

If your new car is a lemon, state laws protect you. But if your new PC is DOA, getting satisfaction is a crap shoot. Depending on your vendor's service terms, you might get a new, working PC or your money back. Or you may face weeks on the phone with tech support trying to fix something that can't be repaired.

In PC World's January Reliability and Service survey, nearly 1 out of 11 respondents said their new PC didn't work when they first turned it on. (Watch for the results of our next survey of readers' experiences in the November issue.) Consumers Union estimates that 5 percent of desktop PCs sold since 1996 did not work on arrival and that 11 percent of PCs had serious problems in their first month of use.

Lousy reliability is the reason automobile lemon laws were enacted. Now, for precisely the same reason, states are turning their attention to the PC industry.

Soured on a PC

Most people expect a PC's warranty to provide adequate coverage, but as George Scully found, many ifs and wherefores lurk in warranty promises. Scully bought a Gateway computer in January for his college-bound daughter. A week later, it wouldn't boot.

Scully tried Gateway's customer service first, then returned to the company store where he purchased the PC. Store personnel agreed to fix it, but only if Scully waived all previous verbal and written agreements and agreed to settle any further concerns by out-of-state arbitration, which is Gateway's company policy.

Wrong answer.

"The computer's a week old. Why do I want to go to a National Arbitration Forum in South Dakota when we've got a state courthouse only a few miles away?" Scully asks.

George Scully is an Illinois state legislator and the key sponsor of a proposed PC lemon act. He didn't mention his sponsorship of the bill during his arguments with Gateway, but he did threaten a lawsuit. The store manager ended up giving Scully his money back. (Gateway includes a standard 30-day limited money-back guarantee with all new products.)

Lay Down the Law

Besides focusing on their warranty, owners of lemon PCs can fall back on the Magnuson-Moss Warranty Act, a federal statute enacted long before PCs became a household commodity.

Scully argues that the Magnuson-Moss law has only vague standards prescribing what vendors must do to correct problems. He thinks that PC buyers need specific laws to protect them from warranty abuses and ineffective repairs, so he is sponsoring the Computer Lemon Act. The Illinois House of Representatives approved the bill last spring. The state senate will likely consider it this fall.

A similar law proposed in Pennsylvania last year failed; it may be reintroduced this year.

Laws Needed?

Most PC vendors we spoke with, including Dell and Gateway, think existing laws and warranties do a satisfactory job of protecting consumers and handling service and repair needs. And vendors do make good-faith efforts to resolve problems--through telephone support, on-site technician visits, and more.

Warranties protect both sellers and buyers. But it's hard to craft warranties that buyers understand and that meet a vendor's legal needs, says Jim Hobby, Gateway's VP of customer care. "The United States is becoming a more litigious society, which unfortunately puts us in a position to write ten-page warranties."

But warranties simply don't give consumers complete protection, Scully contends.

"It's good public policy to put bills out there for discussion to make the manufacturers and retailers aware there is a problem," he said. "We need to tell them, 'If you don't fix it, the state legislatures will.'"