Here's What A 'Satisfaction Guarantee' Actually Means In California
tl;dr Purchasers seeking to exercise their "satisfaction right" in California must do so honestly, reasonably, and in good faith.
It's the ultimate bet on the quality of your product: the 100% satisfaction guarantee.
It's also a bold way to eliminate any apprehension potential customers might have about purchasing your product for the first time. The 100% satisfaction guarantee basically conveys to that nervous, would-be customer, give us a shot--because you have nothing to lose.
The backstory on L.L. Bean's legendary satisfaction guarantee
More than a hundred years ago, Leon Leonwood Bean demonstrated this when 90 of the first 100 customers who took a chance on his new line of hunting boots discovered issues with the boots they had purchased; they brought the boots back to Bean, noting the issues they encountered, and Bean decided to refund their money in full. Although Bean had not marketed this to have been part of the deal, in effect, Bean gave those 90 customers a a satisfaction guarantee.
L.L. Bean changes its satisfaction guarantee
Until 2018, L.L. Bean's satisfaction guarantee was summarily described as...
100% Satisfaction Guarantee. No Conditions. No End Date.
Its lack of a time-limit and lack of any other conditions led people to begin referring to it as a "lifetime guarantee," and this guarantee contributed much to the growth (and retention) of the company's customer-base.
In 2018, though, the company announced a change to its legendary satisfaction guarantee.
Increasingly, a small, but growing number of customers has been interpreting our guarantee well beyond its original intent. Some view it as a lifetime product replacement program, expecting refunds for heavily worn products used over many years. Others seek refunds for products that have been purchased through third parties, such as at yard sales.
Citing "return abuse" by a small fraction of its customers--which the company said cost it around $250 million between 2013 and 2018--L.L. Bean replaced its original satisfaction guarantee with a new, conditional guarantee. The new guarantee introduced a 1-year time limit and other restrictions as to how the product must be treated between the purchase and the return-attempt date.
L.L. Bean hit with multiple lawsuits over its satisfaction guarantee
Almost immediately following this announcement, several lawsuits against the company began to form. These lawsuits were based on various legal theories, including the theory that L.L. Bean breached its contract with purchasers of its product by unilaterally modifying the satisfaction guarantee that was in place on the date of their past purchases, which, in effect, took away a key "benefit of the bargain" (i.e. the right to return products to L.L. Bean in accordance with the original satisfaction guarantee).
In dismissing one of those lawsuits against L.L. Bean, U.S. district judge Yvonne Gonzalez Rogers reminded us what a satisfaction guarantee actually means under California law, and what it requires of purchasers who seek to exercise the rights conferred by the satisfaction guarantee...