General Gansler Announces Fiat Will Honor Chrysler “Lemon
Law” Obligations; Seeks Protection for Maryland Dealers
MD (June 2, 2009) - Attorney General Douglas F. Gansler
announced today that Fiat has agreed to honor the “Lemon
Law” rights of Chrysler buyers after the Italian automobile
manufacturer Fiat effectively takes control of the U.S. auto
maker. Attorney General Gansler also announced that Maryland
has joined with other States to oppose Chrysler’s efforts
to terminate dealerships in violation of State law.
Fiat will effectively
take control over the new company after Chrysler emerges from
bankruptcy. Following negotiations with a
group of state attorneys general, Fiat agreed to honor the right
to seek and obtain a refund or replacement vehicle if consumers’ vehicles
have a significant or recurring problem to which Chrysler consumers
would have been entitled. The agreement has been included in an
order issued today by the Bankruptcy Court judge.
Maryland’s “Lemon Law” provides consumers with
rights and procedures to obtain a refund or a replacement vehicle
if a new vehicle develops a significant problem that can’t
be repaired after a certain number of repair attempts. Lemon Law
rights vary from state-to-state, but generally apply for several
years or up to certain mileage limits for new vehicles purchased
or leased by consumers. During the 2009 legislative session, Maryland’s
General Assembly enacted legislation supported by Attorney General
Gansler increasing Maryland’s Lemon Law to 24 months or 18,000
miles, whichever comes first.
In addition to today’s announcement, Maryland also joined
objections filed by Ohio and Illinois to Chrysler’s proposed
termination of a number of Chrysler dealer franchises in their
“While Chrysler should be allowed to restructure in bankruptcy,
it must do so consistent with State laws,” Attorney Gansler
said. “Our objections contend that the proposed terminations
fail to recognize protections provided for dealers under Maryland
A hearing on the States’ objections
to the proposed terminations is scheduled for Tuesday, June 9th
in the U.S. Bankruptcy Court
in New York.
Attorney General Gansler thanked Karen Cordry, Bankruptcy Counsel
for the National Association of Attorneys General, for her assistance
in reaching the agreement between the states and Fiat.
Consumers are encouraged
to visit the Attorney General’s
website at http://www.oag.state.md.us/consumer/lemon.htm to
learn more about Maryland’s Lemon Law.