Porsche Lemon Nets Owner $266k-and the 911

The service advisor explained that the computer did not find any error codes, so there couldn’t be anything wrong

Wisconsin attorney Bruce Tammi was a car guy from when he was a kid. His all-time favorites were Porsches, and he owned two of them-a 1978 911 Turbo and a 1999 Carrera. But one night his barn took a direct hit by lightning, and the resulting fire destroyed both Porsches.

Armed with an insurance settlement, Bruce leased a new, $133,000 2003 Turbo from one of the three Wisconsin Porsche dealers. He thought it an awesome car, but it developed an annoying glitch. Intermittently, after the rear spoiler had deployed at about 70 mph, Bruce would hear a loud whistling sound, and the dash light indicating a spoiler control failure would come on. Manual control wouldn’t help. The only way to correct the situation was to pull over, shut the engine down, remove the key from the ignition, then restart the motor. The occurrences became more frequent.

He didn’t warn his wife

Then he let his wife borrow the car without warning her about its quirk. He got a frantic phone call from the very dark side of the road, guided her through the “fix” and she was on her way, but presumably not very happy about the behavior of her husband’s very expensive toy.

At the top of Bruce’s list the next day was to take the car to the dealer for repair. But when Bruce picked up the car, the service advisor explained that the computer did not find any error codes, so there couldn’t be anything wrong. “If it happens again, bring it back when it is broken.”

The Porsche quit a few weeks later, and Bruce drove straight to the dealer. Sorry, they were too busy to look at it, and he would have to come back in three weeks.

He did that, and the diagnosis was the same-no error codes. But it failed on the way home. Bruce drove right back to the dealer, but when he got there the service department was closed.

Tried all three dealers

So Bruce went to another dealer… and another, who replaced the spoiler drive. That didn’t fix it, either. Bruce was out of options, as he had been to all three Wisconsin Porsche dealers.

So Bruce boned up on the Lemon Laws. He found that the basis for this branch of the law is the 1975 federal Magnuson-Moss Warranty Act. Generally, if a consumer makes reasonable attempts to get a warranty item on a new car corrected (usually three to four tries), the consumer can bring legal action to receive either a refund of the purchase price (less a reasonable use allowance) or a replacement car. And, importantly, the consumer can recover his legal expenses.

The states have their own Lemon Laws-essentially similar to the federal Lemon Law-except that many of them give broader protection to the consumer. Thus, most Lemon Law claims are brought in state court. That was Bruce’s approach, as he learned that Wisconsin had a very tough Lemon Law.

Check your state’s version

Under all of the Lemon Law variations, the first thing to do is to fully document the claim. You need a good record of your attempts to get the problem fixed, the work that was done by the dealer, and the outcome. Check your state law to determine how many attempts that requires. Next, you have to make written demand on the manufacturer to either refund your purchase price or to replace the car. When the manufacturer refuses to do that, procedural steps vary from state to state.

In Wisconsin, the manufacturer gets the option to force the dispute into an approved non-binding arbitration program. If Porsche had done that, Bruce would have had to participate before he could sue. Instead, Porsche offered a different arbitration program. Bruce rejected that, then filed suit.

The litigation dragged on and Bruce kept driving the Porsche, but the whistling problem had worsened to the point that he experienced a failure every ten minutes or so, which made it impossible to take any lengthy trip. Exasperated, he took the car back to the dealer, who commendably tried again to fix it. Bruce and the dealer learned that a microprocessor in the instrument cluster controls the spoiler and stores any error codes. This microprocessor didn’t store any error codes, so the dealer replaced the instrument cluster. That helped a little-the problem wasn’t solved, but at least now the error codes were being stored.

If you want something done.

When the dealer lost motivation, Bruce bought a shop manual and found a procedure to diagnose the problem. After eliminating everything that had already been tried, he decided the problem had to be in the fuse box. When he inspected it, he found that it was arcing between two fuses and the problem was solved.

Soon after, Bruce’s case came to trial. Both sides presented their witnesses, including experts. The Porsche was found to be a “lemon,” and the focus turned to determining the measure of damages.

Wisconsin law gets fuzzy here. Since Porsche refused to replace the car, the recovery would be money damages-generally the cost of the car. When the car is leased, the cost clearly includes the total of the lease payments, but what about the cost of the buy-out at the end of the lease? In this case, the judge ruled that the buy-out was included in Bruce’s damages, which made his damage claim the entire $133,000 cost of the Porsche.
Under federal Lemon Law, matters would have ended there. But the Wisconsin Lemon Law is much more favorable, and provides that the court must double this amount as a penalty, making the judgment $266,000. And, to add icing to the cake, the judge ruled that applicable Wisconsin legal precedent meant that Bruce did not have to give the car back. Bruce ended up with a 2003 Porsche Turbo and $133,000 in his pocket ($266,000 damages minus the $133,000 paid for the car).

Not a good deal for either side

Those are big numbers, but it’s likely not a good deal for either side. Bruce invested several years of his life in difficult litigation. If he had paid for the legal services, the bill would have been well over $60,000 based on his time, and I think he was being more efficient than an independent attorney.
Porsche spent a lot of money defending the claim. It could have avoided the loss early by fixing the car. It could have settled the case at several points, but made only very modest settlement offers of $10,000 and $24,000. It could have tried to settle the case after the trial ended, but didn’t even make an offer. Instead, it filed an appeal and will incur even more in attorney fees. And that will make it more costly for Bruce as well.
If your new car is acting up and you can’t get it repaired, Lemon Laws can be strong friends. You can learn a lot about your state’s Lemon Laws on the Internet, and many states’ motor vehicle or transportation departments have helpful web sites and forms.
But all Lemon Laws are complicated, and there is a mind-numbing range of options and decisions. It is best to consult an attorney who is skilled in Lemon Law claims, and if you don’t want to incur the full expense, at least hire an experienced attorney to coach you. But keep the attorney informed about your progress, and have him tell you when it’s time to turn it over to professionals.