Gag Clauses

"Ban on lemon-law 'gag' clauses signed Autos: The change means manufacturers can't stop owners from speaking about their cars' defects"

"Automakers forced to buy back defective vehicles under the state's lemon law can no longer force motorists to keep quiet about their cars' flaws.

Gov. Pete Wilson late Wednesday signed a law banning confidentiality agreements as a condition of car buybacks. The law is believed to be the first of its kind.

Consumer advocates fought for the law, saying automakers were refusing to take back problematic cars unless motorists agreed to sign the agreements, dubbed 'gag clauses.'

'I'm very pleased the governor put public safety before special interests,' said Rosemary Shahan, founder of Consumers for Auto Reliability and Safety [sponsors of the bill who organized support for the measure].

The automotive industry [and the entire 'tort reform' movement] opposed the law, saying it would impede their ability to reach settlements with unhappy motorists. Carmakers said they often buy back cars that aren't defective, to keep customers happy, and shouldn't have to suffer negative publicity.

But the state Department of Motor Vehicles pushed for the new law, saying the gag clauses limited the state's ability to track unsafe cars."

– Orange County Register, October 2, 1998