A class action lawsuit accuses warranty service provider SquareTrade of deceptively marketing its protection plans on Amazon.com.
The lawsuit states that SquareTrade sells extended warranties and service plans for numerous consumer goods, such as electronics and appliances. The complaint claims that SquareTrade markets its plans through many different companies, but its largest partner is Amazon.com.
Consumers can either purchase SquareTrade protection plans from an advertisement after purchasing an item from Amazon.com, or they can go directly to the SquareTrade product page on Amazon.com.
In either case, the protection plans are priced according to the length of the plan and the type of items under warranty, and could cost anywhere from $1 to $6,000 for the plan.
The complaint asserts that SquareTrade violates New York consumer protection law because it does not provide potential customers access to the terms and conditions of their protection plan before buying it.
Not only is a link to the terms and conditions buried at the bottom of the webpage after scrolling through unrelated advertising, but it isn’t even the correct terms and conditions for the protection plan, the lawsuit claims.
According to the complaint, the terms provided pre-sale are “drastically different and more generous than the post-sale Terms and Conditions that SquareTrade enforces against the customer after she purchases a Protection Plan.”
Separately, the class action contends that SquareTrade sells protection plans for items it knows are not covered by the plan—namely, items not bought from Amazon.com. The complaint argues that SquareTrade does not provide sufficient notice on the Amazon sales pages that the items must be purchased through Amazon for the plan to be effective.
The class action states that SquareTrade is provided purchase information if an item is bought from Amazon.com, so the company knows which customers did not buy their items there. However, SquareTrade does not void the contract unless a customer actually makes a claim on such an item.
In addition, the company does not provide a refund for the protection plan unless the consumer takes extra steps to ask for it. The complaint contends that through these tactics SquareTrade receives and keeps money that it should never have obtained.
“This scheme is as simple as it is profitable,” the class action states.
Plaintiff Adam Starke says he purchased a CD player from Staples in December of 2015, and several days later he purchased a SquareTrade 2-year electronics protection plan for it from Amazon.com. Starke claims that at no point was he informed that the protection plan only covers good purchased from Amazon.com.
Starke was contacted via email after purchasing the plan, and submitted a copy of his Staples receipt to SquareTrade. In October, Starke claims he contacted SquareTrade to cover necessary repairs for his CD player, which SquareTrade refused because the CD player was not bought from Amazon.com.
The complaint asserts that SquareTrade has not refunded the price of the protection plan to Starke.
The deceptive marketing lawsuit requests certification of a Class of “All residents of the United States who purchased a SquareTrade Protection Plan on Amazon.com within the [past] four (4) years.”
The class action seeks restitution, treble damages under consumer protection laws, and an injunction stopping the deceptive marketing practices.
Starke is represented by Mark Schlachet of the Law Offices of Mark Schlachet, Bradley J. Nash of Schlam Stone & Dolan LLP, and Solomon N. Klein of the Law Office of Solomon N. Klein.
The SquareTrade Protection Plan Class Action Lawsuit is Adam J. Starke v. SquareTrade Inc., Case No. 1:16-cv-07036, in the U.S. District Court for the Eastern District of New York.
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22 thoughts onSquareTrade Class Action Says Extended Warranty Plans are Fake
where is the link for others to file otherwise its just another headline on this page because we could not file as well lol I am due money as well, I bought a chainsaw and was told the exact same thing, IF I do not get a response I will file a new suit on a personal and business level and well why should I? we need the ling folks.
I filed a claim with SquareTrade on a hoverboard scooter that I purchased and insured. The first time I filed I was told that the item was still covered under the factory warranty. In fact it was not covered so I re-filed with SquareTrade and was told at that time that they did not cover the scooters. I called SquareTrade directly to insure the item and they knew exactly what it was at the time. They refunded my money but had I never filed a claim, I would have never known that I was ripped off.
I need to know how to join this action.
The case is still moving through the courts and has not yet reached a settlement. Claim forms are usually not made available to consumers until after a court approved settlement is reached. We recommend you sign up for a free account at TopClassActions.com and follow the case. We will update the article with any major case developments or settlement news! Setting up a free account with Top Class Actions will allow you to receive instant updates on ANY article that you ‘Follow’ on our website. A link to creating an account may be found here: https://topclassactions.com/signup/. You can then ‘Follow’ the article above, and get notified immediately when we post updates!
I know someone who bought 4 wireless data radios at $1500 each. When they failed, Squaretrade refunded their money and wouldn’t honor the warranty. I’m sending them this link. Someone needs to sue the crap out of them and Amazon for this or someone needs to be going to jail at Squaretrade.
How do join. There not going to get away with this alive
I have a very similar issue with squaretrade and would like to know how to joint this effort.
I live in Arizona. I bought a SquareTrade plan direct from their website for a laptop I purchased from American National Insurance Company’s Home Office that supplies the laptops we use in the field offices preloaded with Insurance Software. The computer was brand new and was registered the first time by me and fully warranted by Lenovo.
I bought it in April 2015 and filed the receipt with SquareTrade the same month and it was accepted by SquareTrade, filed on their website, and a confirmation email was sent to me saying they accepted the receipt and I was protected and good to go.
Right before Dec 23, 2016 I spilled coffee on my laptop and the G & H Buttons plus the Number Keypad stopped working. I filed a claim with SquareTrade.
Three days later I received an email from them that after reviewing my receipt, they decided my purchase didn’t meet what they considered “New” because it was purchased from a company, not a retail store, and that they were cancelling my warranty and refunding the purchase price of the warranty $129 instead of fixing the $700 laptop.
I called Customer Service and they said they would have someone call me back within two days. After not hearing from them for 4-days I just called and was told. They (India Customer Service) made their decision and have cancelled my warranty and won’t fix my laptop.
He further told me that no one reviews the receipts until it is time to fix them and then they decide if the receipt is good enough. I explained to him that what they are selling is Insurance. With Insurance, if they accept the money without returning it and Informing within a timely period, they have accepted the contract no matter the defects since they did not act.
I guess looking into a Class Action Lawsuit altogether against SquareTrade is worthwhile.
I have 67 warranties through them. I had never a problem until now. When I called Squaretrade & asked which plan I should buy, and I purchased it. Now when there is a problem they tell me it is under the wrong one and they will not cover it. I asked even if an employee told me and Ben told me no. Don’t matter even if and employee told me!! This is bull crap Ben was nice as could be until I started questioning him more than he got rude. I told him I was going to post about him, no care at all. I asked for the headquarters phone number and he said he did not have it. I also asked to speak to the supervisor and could’nt do that neither. If the is a suit I want to be included. l
I USE SQUARE TRADE ALL THE TIME AND IT’S GOOD I PLACED CLAIMS WITH THEM HAVE HAD NO PROBLEM VERY HELPFUL PEOPLE AND I THEY PAID ON EVERYONE AND YES YOU CAN USE MY NAME
Hmmm? My wife recently purchased a T.V. and purchased this Square Trade protection plan… The protection plan is about 44-45 pages, and we had to print it out ourselves.
I have to warranty contracts with square trade for my electronics. Please enclude my name in this law suit.
How to join?