Back in July, I wrote a post about the Federal Trade Commission’s call for public comment about the Used Car Rule. I said that the Used Car Rule should be revised to require even greater disclosure to consumers, and listed seven changes I thought the FTC should make.

Recently, Attorneys General from 40 states, the District of Columbia, and the Northern Mariana Islands submitted a joint comment to the FTC. Because lemon laws and consumer complaints often run through their offices, they know quite a bit about consumers’ problems with used cars. They say without hesitation that the Used Car Rule is valuable, but say (as I did) that it doesn’t go far enough.

The statement by the Attorneys General says, in part:

However, the Rule’s value is limited by the fact that it does not provide notice about the most material information consumers need to consider and, indeed, do consider in deciding whether to purchase – that is the vehicle’s history and prior use, including its prior title status, damage history, and whether it was repurchased by the vehicle manufacturer pursuant to a state Lemon Law.

They go on to say that the Wisconsin Buyer’s Guide should be a model for the FTC’s Buyer’s Guide.

Interestingly enough, ten Attorneys General didn’t sign the comment – those from Alabama, Alaska, Hawaii, Nebraska, North Carolina, Oklahoma, Pennsylvania, Texas, Utah, and Virginia.

Recently, a story ran in the Connecticut’s The Hour telling an all-too-common tale of a consumer who purchased an older used car, only to have it break down once he drove it off the lot. Although the state has one of the most comprehensive lemon laws in the country – notably because it also covers used cars – there are limits. Specifically, used cars have a 60-day implied warranty only if they’re less than six years old and are sold for more than $3,000.

That puts many consumers – who have to scrape together the money to buy a vehicle to go to and from work – in the untenable position of having a defective used car and no money for repairs.

According to the news story, when Connecticut State Senator Bob Duff was asked, he was opening to revising and expanding state law. The article quoted him as saying, “Any time we see holes in consumer protection laws, we should definitely address it and tighten any loopholes that are out there.”

Hopefully, Senator Duff will seriously consider taking this matter up when the Legislature reconvenes. After all, Connecticut was first in the nation to pass a lemon law; the state can take the lead again in expanding protections for consumers who buy used car lemons.

With the holidays just around the corner, consumers are clamoring to find great deals on personal electronics to give as gifts. A recent article in the Baltimore Sun, however, reminds us that if that gift turns out to be a lemon, you do have legal recourse.

In the Sun article, writer Dan Thanh Dang recounted the trials and tribulations of Aaron Shepard, who bought a notebook computer for school. From the beginning, he had nothing but problems with it. He sent the computer back to the factory eight times for repair (at his own expense), and the problems still weren’t fixed. Ultimately, the company replaced it with a refurbished machine, which in turn had myriad problems. Yet the company claimed it was under no obligation to replace the computer – only to fix the problems as long as they were under warranty.

The Montgomery County Office for Consumer Protection begged to differ, since that state doesn’t allow manufacturers to waive implied warranties. The implied warranty in this case is a warrant of merchantability – the promise that a product will do what it was intended to do. What the article didn’t mention was the Magnuson-Moss Warranty Act, a federal statute that covers all products that cost more than $25.

The take-away? Legislators should get busy writing lemon laws for electronics. In the meantime, if you give or receive electronics this holiday season, keep in mind that the law is on your side if you find that you have a lemon.

Recently, Fox 5 out of New York reported on a Queens dealership that was ordered to refund a lemon owner’s money two years ago, but that still hasn’t paid up. In 2006, Jessica Harrison bought a BMW M3 from Planet Automall. After spending almost $45,000 for the vehicle, she had nothing but problems. According to the Fox report, Harrison took it in for repair a number of times, and then took it in to a BMW dealer, which found that the car wasn’t safe to drive.

When Harrison filed a lemon law complaint, the arbitrator found in her favor, and ordered Planet Automall to refund her money. After that ruling, in September 2006, the dealer filed a legal challenge to arbitrator’s decision, saying - among other things - that she hadn’t return vehicle. When Harrison tried to return the car, the dealer refused to formally accept it. Eventually, someone from the dealership took the car, and parked it across the street. Over the course of two months, the car racked up $1,700 in parking tickets, while the dealer claimed that it didn’t have the car in its possession.

This past May, a judge confirmed the arbitrator’s award and ordered the dealership to pay up. Instead, Planet Automall filed another appeal. In the meantime Harrison not only has to keep making payments on the Beamer, but had to buy another car for transportation.

From Fox’s report, it’s clear that Harrison has the law on her side, and it’s a good thing that she has an attorney representing her interests. Even though the legal battles have racked up $15,000 in attorney’s fees, the court will most likely order the dealership to pay those fees.

The CEOs of GM, Chrysler, and Ford were back in Washington, where the proverbial rubber met the road. While the chief execs actually - gasp! - drove to D.C. instead of flying in their private jets, Congress didn’t pull out the checkbook. The Big Three asked for a bailout of $34 billion, up from the $25 billion they requested in their earlier appearance before the Senate Banking Committee.

This time, there wasn’t quite as much posturing by Senators, and there wasn’t quite as much arrogance on the part of the CEOs. Still, according to CNNMoney, Congress doesn’t appear to be in any real rush to push through a bill, and hope of stopgap Treasury Department or Federal Reserve funding seems remote.

The media coverage of any potential bailout or bankruptcy has generally focused on the ripple (or riptide) effect that the Big Three’s downfall would have on the U.S. economy. Typically, the coverage centers on job losses, autoworker retirement benefits, dealerships, and suppliers. It never seems to address the impact on consumers who own those vehicles.

If one, two, or all three of U.S. automakers were to go under, what would that mean for car owners? If dealerships close down, where would consumers go to get warranty work done? If Ford, GM, or Chrysler were to file Chapter 7 bankruptcy, it’s possible that a trust could be established to pay warranty claims over time - but that’s far from a sure thing.

As for owners of lemon cars, the picture is even murkier. It’s possible that lemon law claims would fall under an exception to the Bankruptcy Code, but that exception usually applies only to governmental actions, not to individual actions by consumers.

Should there be some kind of bailout? While I’m usually involved in fighting automakers on behalf of consumers, I do think that it’s in the best interest of consumers that GM, Chrysler, and Ford survive. And, after giving Wall Street a $750 billion blank check, it doesn’t seem like a stretch for Congress to lend a helping hand to Detroit - providing we taxpayers get something in return.

In his always-incisive, satirical analysis, Jon Stewart of The Daily Show summed up the issue in a message to Congress:

The auto industry has a product that is tangible…. Even the [cruddy cars] are useful. But you won’t bail out the people who make cars. You’ll only bail out the people who make car loans. Not even car loans. The people you bailed out make derivative paper transfers speculating on the future value of enormous groupings of said loans to China. We know that Detroit’s business model is bad. We know they lose $2,000 on every car they sell. Wall Street lost $7 trillion dollars without selling anything. At least when Detroit loses money, we get cars. So give them the money!