Ask Andy: Michelin settlement - WMC Action News 5 - Memphis, Tennessee

Reported by Andy Wise

Ask Andy: Michelin settlement

A big tire-maker is in big trouble for its advertising claims.

Tennessee Attorney General Bob Cooper says 17 states, including Tennessee, sued Michelin North America over fuel economy claims in both its print and television ads.

Cooper says at issue is claims like this one in Michelin's TV ads:

"Michelin makes the most fuel-efficient line of tires on the road, which saves you money over the life of your tires."

Cooper's spokesperson Sharon Curtis-Flair says Michelin's own studies indicate its tires are only the most fuel-efficient in 78 percent of its tire classes.  Michelin's competition has more fuel efficient tires in the other 22 percent.

Now, you might say this is all about semantics.  After all, the studies show Michelin IS the most fuel-efficient tire 78 percent of the time.

But Cooper and 16 other state attorneys general allege Michelin's ads failed to disclose that its claims are based solely on fuel savings.  Cooper says Michelin completely left out other cost factors like the cost of the tires themselves, maintenance, replacement, etc. and how those costs may outweigh the fuel savings.

Michelin has cooperated fully with the states.  Cooper emphasizes that the states' investigations never questioned the safety of Michelin tires, just the company's advertising claims.  

Michelin will pay 17 states $375,000 in exchange for not admitting to any wrong-doing. 

Tennessee's share is $48,750.

But consumers won't see any of it. There is no consumer restitution in the settlement. The attorney general says it's too difficult to determine which consumers bought the competition's tires and might have actually saved more money.

Instead, some of the money will cover attorney's fees and expenses, and some will go to fund consumer education projects as mandated by Tennessee law.

Here's a link to the attorney general's release on the settlement and to video of Michelin's ads:

http://www.tn.gov/attorneygeneral/press/2009/story/PR16.pdf

 

 

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