The $5.4 billion company sold warranties on electronics,home appliances and entertainment products called Extended Care Plans or Extra Care Plans that expired three to six years after purchase. Consumer advocacy organisation Choice conducted a survey that found one in three customers had purchased the warranties sold using allegedly aggressive sales techniques.
“These warranties are in most cases little more than a junk add-on to consumers’ purchase of the household goods they actually want,” said Maurice Blackburn principal Miranda Nagy.
“Our case alleges they added nothing meaningful to the strong rights for repair,replacement or refund under the Australian Consumer Law rights that consumers already enjoy.”
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The class action doesn’t appear to have alarmed shareholders,however,with investors sending the share price up 0.8 per cent in afternoon trading.
Maurice Blackburn is alleging JB Hi-Fi did not give customers information about their rights under the Australian Consumer Law before deciding whether to purchase the extended warranty,something companies must do.
“Businesses should explain what an extended warranty provides over and above the consumer’s automatic rights,” theACCC website states.