The California court system has found that Toyota Motor Insurance Services does not violate the state's consumer warranty law. According to Automotive News, a court of appeal found that the contracts offer enough services outside of the factory warranty to be considered legal. Toyota was originally sued after Weber DeSiqueira purchased a then-new 2007 Tundra. At the time, the vehicle came with a three-year, 36,000 mile warranty, but DeSiqueira also laid down $1,145 for a Toyota Extra Care Vehicle Service Agreement. The lawsuit alleged that the service agreement covered the same items as the factory, putting the Japanese automaker in violation of the California warranty law.
But a Los Angeles judge dismissed the case without allowing it to go to trial. DeSiqueira appealed, and a three-judge panel unanimously decided that the automaker's service agreement and the factory warranty are not identical. The plaintiff sought damages and retribution in the form of a refund for the price of the service agreement for himself and other car buyers who had opted into the program.

Despite the fact that the appeals court effectively scuttled Desiqueira's lawsuit, one judge did suggest that the consumer may have a legitimate claim that Toyota engages in deceptive sales practices by leading buyers to believe that the service agreement offers greater protection than it actually does.

[Source: Automotive News – sub. req]

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