Wal-Mart Beats Sam’s Club Extended Warranty Class Action Lawsuit

Wal-Mart Stores Inc. has escaped a class action lawsuit accusing the retailer’s subsidiary Sam’s Club of selling worthless extended warranties for certain items.

Plaintiff William Hayes sued Wal-Mart in 2010, alleging that he purchased a power washer and television from Sam’s Club that were reduced in price because they were so-called “as-is items.” Hayes alleged in the class action lawsuit that he was offered the opportunity to buy service plans that would cover the costs of repairing or replacing the products in the case of a defect. However, many as-is items are not covered by the manufacturers’ warranties that form a key part of service plans.

On Feb. 20, Judge Jerome B. Simandle, responding to concerns from the Third Circuit Court of Appeals regarding Hayes’ ability to serve as class representative due to questions regarding whether or not he sustained an injury-in-fact, completed a de novo review of the facts regarding the case and had difficulty construing facts in the man’s favor.

Wal-Mart had argued two points in seeking summary judgement; first, that he “has produced no evidence that his as-is power washer did not come with a manufacturer’s warranty and thus would not be covered under the terms of the service plan. [In addition,]… even if [his] power washer did not come with a manufacturer’s warranty, he still lacks … standing because he has suffered no actual harm and any claim of future harm is speculative.”

Judge Simandle agreed, noting that Hayes was unable to produce documentation indicating there was no manufacturer’s warranty for the items he purchased. While the man’s class action lawyers argued that it was the equivalent of trying to prove a negative, the order still could not read the evidence, even in a favorable light, that would give Hayes the go-ahead to act as class representative against Wal-Mart regarding the service plans for as-is items sold at Sam’s Club.

The judge specifically noted that Hayes “does not recall if, at the time of purchase… he received any written materials relating to a manufacturer’s warranty” and further, he had suffered no economic harm because there was no flaw with the power washer.

Hayes is represented by class action attorneys Daniel R. Lapinski of Wilentz Goldman & Spitzer PA and James C. Shah of Shepherd Finelman Miller & Shah LLP.

The Sam’s Club Extended Warranty Class Action Lawsuit is William Hayes v. Wal-Mart Stores Inc., et al., Case No. 10-cv-00460, U.S. District Court, District of New Jersey.