• What Constitutes Pecuniary Loss Under the Wisconsin Lemon Law?
  • March 4, 2009 | Authors: Jeffrey S. Fertl; Melissa J. Lauritch
  • Law Firm: Hinshaw & Culbertson LLP - Milwaukee Office
  • Tammi v. Porsche Cars North America, Inc., 536 F.3d 702 (7th Cir. 2008)

    On February 4, 2009, the Wisconsin Supreme Court will hear oral arguments regarding the interpretation of “pecuniary loss” under Wisconsin’s Lemon Law, Wis. Stat. § 218.0171. Under Wis. Stat. § 218.0171(7), a consumer may bring an action to recover damages caused by a violation of the Lemon Law. The law allows a prevailing consumer to recover “twice the amount of any pecuniary loss.”

    The case before the Supreme Court is Tammi v. Porsche Cars North America, Inc. In October 2004, Bruce Tammi sued Porsche Cars North America, Inc. alleging a violation of the Wisconsin Lemon Law. The case proceeded to trial in federal court (unpublished opinion, 2007 WL 777522 (E.D. Wis.)). Tammi alleged that a rear spoiler on his leased Porsche automobile was defective and that the defect had not been repaired after four attempts by certified Porsche repair centers. Subsequent to filing his lawsuit, Tammi purchased the vehicle at the end of its lease term. In his action, Tammi sought pecuniary loss damages for his monthly lease payments and the amount he paid for the car at the end of the lease.

    In August 2006, the jury found that the defective spoiler was a nonconformity and awarded Tammi $26,600 for “pecuniary loss” caused by that nonconformity. The district court altered the verdict on damages and awarded Tammi $266,159.76 - twice the amount of both the lease payments and the purchase price. The court also rejected Porsche’s argument that the damages should be offset by a reasonable allowance for use, and allowed Tammi to retain the vehicle.

    On appeal, the United States Court of Appeals for the Seventh Circuit affirmed the verdict regarding the finding of a nonconformity. However, the court elected to certify four questions regarding the Lemon Law’s pecuniary loss provision to the Wisconsin Supreme Court, stating that Wisconsin law provides insufficient guidance on the issue.

    The certified questions are:

    • When a consumer defined in Wis. Stat. § 218.0171(1)(b)4 brings an action pursuant to subsection (7), if that consumer, after making his Lemon Law demand, then exercises an option to purchase and buys the vehicle as provided in the lease, is the consumer then entitled to recover the amount of the purchase price?
    • If the consumer defined in Wis. Stat. § 218.0171(1)(b)4 is entitled to recover the vehicle purchase price when he exercises the purchase option provided in the lease, does the purchase amount qualify as pecuniary loss subject to the doubling provision in subsection (7)?
    • If the answers to questions 1 and 2 are in the affirmative, is the consumer permitted to keep the purchased vehicle in addition to the receipt of the damage award or must the vehicle be returned to the manufacturer?
    • Is a damage award under subsection (7) subject to a reduction for reasonable use of the vehicle?

    The Wisconsin Supreme Court’s answers to these questions will impact motor vehicle manufacturers and consumers alike.