No Consumer Compensation in Michelin Tire Fuel Efficiency Claims SettlementMay 9, 2011 | Parker Waichman LLP
A widely-touted 2009 settlement between Michelin North American and attorneys general in 17 states did nothing to help consumers who were taken in by the company's promises that its tires would improve their vehicles' fuel efficiency and save them money. Though the 17 states involved split $375,000.00, and Michelin promised to take steps to clarify claims in its tire advertising, consumers received nothing in the way of compensation.
The Michelin tire fuel efficiency settlement was the result of an investigation initiated by the Tennessee Attorney General. According to the investigation, Michelin began an advertising campaign in 2008 - when the price of gasoline was nearing $4.00/gallon - that promised purchasers of its tires greater fuel efficiency and cost savings. The ads, which ran in print in The Wall Street Journal and USA Today, and on TV on ESPN, included statements like: “It’s time to fight back. Michelin fuel-efficient, long-lasting tires help you save money,” and, “Michelin makes the most fuel-efficient line of tires on the road, which saves you money over the life of your tires."
The attorneys' general investigation found that Michelin's fuel efficiency claims were misleading. Michelin did not adequately disclose that the advertised cost savings were based solely on savings in fuel costs, and did not take into account the cost of maintenance, replacement, etc. and how those costs might outweigh the fuel savings. The investigation also concluded that Michelin’s own studies indicated that its tires are only the most fuel-efficient in 78 percent of its classes of tires. However, in some classes of tires, a Michelin tire was not the most fuel-efficient.
In addition to paying $375,000 to the 17 states - Alaska, Arizona, Delaware, Iowa, Kentucky, Massachusetts, Montana, Nevada, New Hampshire, New Mexico, North Carolina, Ohio, Pennsylvania, Rhode Island, Tennessee, Texas and Vermont - Michelin agreed to “possess competent and reliable scientific evidence substantiating any fuel-efficiency claim regarding its tires and to make other business practice improvements regarding its advertising.”
While the Michelin tire fuel efficiency claims settlement was widely publicized, purchasers of the tires received nothing. Since Michelin has offered no compensation, consumers will likely need to pursue their own Michelin tire class action lawsuit if they want recourse.