A situation has developed that many automobile owners in Hawaii may want to follow. A federal court has been asked to determine whether people who own products under a brand name whose manufacturer has been found negligent for other defective products may seek damages for the potential devaluation of their own products due to a tarnished brand name. Reportedly, the court determined that product owners are not entitled to pursue such compensation.

The case developed following the well-known corporate debacle involving General Motors Corporation and its negligence regarding failed ignition switches in many of the company’s automobiles. Plaintiffs’ representatives have apparently also suggested that those directly affected by the flawed ignition systems are not the only ones damaged by GM’s negligence. The attorneys assert that anyone who owns any type of GM motor vehicle has suffered because the brand name is now tarnished, thus devaluing the potential re-sale of their vehicles.

A federal District Court judge determined a “brand devaluation” theory has not been previously recognized by any court. It reportedly differs from a “benefit of the bargain” claim that addresses those who overpaid for products when purchased.  The judge further found that damages sustained by those whose vehicles were directly affected by recalls for failed ignition devices is another matter entirely from those whose vehicles are made by General Motors but not listed as recalled items.

The judge questioned whether forcing companies who have tarnished their own brand names to pay plaintiffs who own their other products is worth the cost of such endeavors. However, any person injured by defective products may indeed pursue justice through the courts by filing product liability claims against any and all parties deemed negligent in the matter.  A personal injury attorney in Hawaii would be able to guide a consumer through the process when a defective product has caused injury in this state.

Source: reuters.com, “Tarnished brand doesn’t give consumers right to sue: GM judge“, Alison Frankel, July 19, 2016