Smith’s Suit Converted To Class Action

It would take a giant showroom to accommodate every customer of the defunct Smith’s Home Furnishings chain who could recover money spent on warranties as a result of a ruling in Spokane Superior Court Friday.

Judge Harold Clarke converted a lawsuit filed by a handful of shoppers last November into a class action on behalf of 27,000 people who purchased $9 million worth of warranties on a wide range of appliances.

The retired jurist said he has never handled a case covering so many plaintiffs.

When Smith’s filed bankruptcy last August, responsibility for honoring its warranties fell to General Electric Capital Corp., which financed the contracts for rates as high as 24 percent, said attorney John Giesa, who represents the former chain’s customers.

The warranties provided service for up to five years. Premiums ranged from $100 to $400.

In some cases, customers who did not require service could redeem the amounts paid in premiums for in-store credits.

GECC attorney Steve Rummage argued there is no case in which the lender who financed a warranty has been held responsible when the store that issued the agreement failed.

Nor can his client get due process when the claims of each plaintiff are so different, he said.

But Giesa said GECC’s conduct in every case was the same. If every set of circumstances had to be identical, he said, “You never would have a class action.”

Clarke’ ruling applies only to purchases made at Smith’s Washington stores.

In Idaho, the Attorney General’s Office last month announced a settlement with GECC that will enable Smith’s customers in that state who had not fully paid for their warranties before the bankruptcy to get credits at stores near the former Smith’s locations.

, DataTimes