Fender is not honoring older Guild lifetime warranties.

[hideglue]

...and still a better deal than the alternative.

 

[West R Lee]

West

 

[FrankBullett]

My experience with Fender has been very bad. I do not believe they stand by the product or the hand picked luthiers they require you to take the Guitar for warrenty. A long story that I will not bore anyone with here but my view is that there really is buy assuming your on yur own.

 

[jwsamuel]

I have mixed feelings about this. Sure the guitar was purchased with warranty and the company is still in business but under new ownership.

When you buy a company, you buy its obligations.

Jim

 

[Terry Allan Hall]

I have mixed feelings about this. Sure the guitar was purchased with warranty and the company is still in business but under new ownership.

When you buy a company, you buy its obligations.

Jim

Agreed. 8)

 

[fronobulax]

I have mixed feelings about this. Sure the guitar was purchased with warranty and the company is still in business but under new ownership.

When you buy a company, you buy its obligations.

Jim

Not always, at least under United States law. Wishing otherwise ain't gonna make it so.

 

[capnjuan]

I have mixed feelings about this. Sure the guitar was purchased with warranty and the company is still in business but under new ownership.

When you buy a company, you buy its obligations.

Not always, at least under United States law. Wishing otherwise ain't gonna make it so.

Hi Frono; are you referring to Bankruptcy law? If not, what law are you talking about?

Generally speaking a party buying a company and the seller can't between themselves agree to extinguish the rights of a third party - in this case a warranty obligee - without that party's say so.

Said another way, two parties can't agree that a third party has no rights ... well ... I guess they can agree all day to whatever they want but that doesn't really change whether a third party still has those rights; they aren't lost just because the buyer and seller say they are.

Do you have a citation here or even an anecdote?

 

[fronobulax]

Do you have a citation here or even an anecdote?

Toxic GM is my favorite example although I cannot find anything to confirm my understanding that the company was split before filing for bankruptcy so I could be wrong on that specific case.

However if you Google for the difference between an asset sale and an entity sale you should find examples and anecdotes. See this for one such discussion.

In this part of the world there are lots of entrepreneurs who form companies and then sell them. They will do an asset sale and then have the remaining entity declare bankruptcy. Not necessarily ethical but perfectly legal.

I will reiterate that We Do Not Know what was sold to Fender, but if it was an asset sale then all of the kvetching about pre-Fender warranties is a matter of customer relations and corporate integrity and not a matter of law. If it was an entity sale then things might be different but the lawyers need to tell us, not the other way around.

Some of us might be old enough to remember when Acoustic Control made instrument amplifiers with lifetime warranties.

This site[/url]]Acoustic Control Corporation had the Lifetime Warranty for Acoustic amps. When they sold the company, the successors were under no obligation to honor Acoustic Control Corporation's Lifetime Warranty. Wagner Group, the next Acoustic company after ACC, did honor it as a courtesy.

 

[capnjuan]

... GM ... See this ... In this part of the world there are lots of entrepreneurs who form companies and then sell them. They will do an asset sale and then have the remaining entity declare bankruptcy. Not necessarily ethical but perfectly legal.

In Bankruptcy, all the unsecured obligations including warranty - because it isn't secured - are discharged; too bad, that's it, everybody have a nice day. Your link provided the following re/ Asset v. Entity sales and unsecured creditors:

" ... Sellers prefer entity sales over asset sales, because with them any of the company’s unknown liabilities are transferred to the new owner; whereas in an asset sale the liabilities remain with the seller. These liabilities might include contract claims, potential product liability claims, or employee lawsuits resulting from the seller's ownership of the company ..."

Restated, if a buyer buys the Entity, they buy the Liabilities too and the sales agreement will include an indemnity whereby claims of any kind against the seller will be made good by the buyer ... because the buyer bought all the Liabilities; those already on the books and contingent. The larger the prospect for these claims, the smaller the selling price.

If a buyer buys only the Assets and the seller 'Bankrupts' the rest of the company, then the same rules about loss of creditor's/warranty obligee's rights applies as if it were a conventional bankruptcy.

This may be one of those situations where we are vigorously agreeing; absent Bankruptcy in some form, warranty rights aren't extinguished just because somebody would prefer that they be. I don't know what Fender did or didn't buy either but my guess is that they honor as few as they can to sustain some appearance of standing by the Brand name ... but without overdoing it.

 

[fronobulax]

This may be one of those situations where we are vigorously agreeing; absent Bankruptcy in some form, warranty rights aren't extinguished just because somebody would prefer that they be.

I think violent agreement applies. The possible addition would be that there are ways for a corporate entity to cease to exist without explicitly declaring bankruptcy.

 

[capnjuan]

This may be one of those situations where we are vigorously agreeing; absent Bankruptcy in some form, warranty rights aren't extinguished just because somebody would prefer that they be.

I think violent agreement applies. The possible addition would be that there are ways for a corporate entity to cease to exist without explicitly declaring bankruptcy.

If the (unasked) rhetorical question is whether bounders can find ways to mistreat others ... the (rhetorical) answer has to do with brown bears in the woods.

 

[Aerohead]

I agree jg, or be very specific about what is covered under the warranty. But mostly I think there should be time limits. No one would take their old beater car that's been 200,000+ miles back to the dealership and expect a new transmission, would they? Nope. Things have a useful lifespan and after that they require major work to keep them going.

Sometimes I think y'all are conflicted. You expect a lifetime warranty to be honored and do any and all work related to the guitars in a timely manner and neck resets after 25 years done as warranty work.... and at the same time you hope that Guild as a brand name stays viable. Well, if you suck all the possible profit out of the item, and overburden the company with repairs and warranty work for free.... then the company is not gonna survive. They're difficult items to make utilizing very specifically skilled labor and materials. I don't think you can have EVERYTHING. If they did all the things you expect them to do, they'd be out of business in a very short amount of time.

I can see reasonable time limits on warranties and prompt service as good things.

Basically what I'm saying is, you can't have it both ways. And I'm not saying that FMIC is doing everything right. But many times you're asking for things that conflict. Do you want them to continue making Guilds? Or do you want them to spend their time and resources rebuilding y'alls 35 year old guitars?

This is just my opinion, which is held in very high regard by probably ME ONLY. I'm just seeing both sides of this. Anyone?
Tom in Vegas

If I buy a brand-new guitar offered w/ a lifetime warranty, I paid that $$$, in part, for that lifetime warranty.

If the guitar has a limited (to, say 5 or 10 years) warranty, I'll expect pay considerably less or buy something else entirely.

I'll pay even less for a throw-away guitar, obviously.

Fender bought Guild...Fender should honor Guild's warranty exactly as Guild did, or not call 'em Guild's.

Now this was well said and I was going to post a very similar rebuttal, thanks for saying it for me. Also i might add without honouring the lifetime warranty I can guarantee my next brand new guitar will be purchased from someone who does!

 

[Aerohead]

@TMG, yes, it would be a RULE and a POLICY and although some people might not like it or believe it's fair.... everyone would know where they stood. I'm sure they have a policy, wouldn't you think? If they don't, I'd be making one pronto. Tom in Vegas

You know Tom, maybe my guitar was a bit of an aberration, but I found out after almost 38 years that my D50 had a defective neck set from the get go. What would you do in cases like that? After all, it's a lifetime warranty against defects in workmanship, correct?

Well, Sandy, I don't know the exact situation with your particular guitar. If the neck has needed a reset all along, why did it take so long to recognize it and get them to take action? 38 years is a LONG TIME. And if it didn't show itself for 38 years and played normally all that time, is it really considered a "defect"? Maybe it's just the hands of time that have played havoc with your instrument. So what I'm saying is, how long should it take to notice a defective neck set? And if it plays normally and well for 38 years, is it really considered defective? Seems you had a pretty good run with that guitar. So I'm confused about the particulars of your specific guitar.

If Fender does us all wrong, how many new Guilds will you, yourself, be buying? :?:

As many as I would have bought otherwise. I understand that when companies change ownership all assets and all liabilities may not be transferred to the new owner. It is potentially a clean slate for the new owners no matter how many consumers, suppliers, creditors and the like get screwed.

Exactly. When I made my choice some 18 years ago between my Guild and a Taylor (it had come down to those two, and I'm sure Taylor has some type of warranty) the specifics of any warranty were negligible. My decision was based on sound and playability.

This debate will continue on, I'm sure.
Tom in Vegas

Seems like because you put no weight on the lifetime warranty when you bought your guitar that nobody else did either? It's a BIG reason that I bought a Guild instead of paying the extra $$ for a Gibson Or Martin! Great sound and the same warranty. Take away the warranty from that equation and I would have gladly paid the extra $$ on one of the other manufacturers new products. Honour the liftime warranty and you have a lifetime customer dont honour it and lose multiple customer and have a public relations nightmare and multiple word of mouth stories that will influence future new guitar buyers on their next purchase. The question is do you try to save money on the warranty claims now in exchange for a trustworthy and viable company in the future. Im not sure I would want you being the CEO of my company.

 

[spiderman]

I think that FMIC certainly has the right not to honor old Guild warranties, since they are not the same entity as Guild, though it all depends on what the acquisition papers say. Now if you are talking good will and the thought that what good is the current Guild warranty if FMIC sells it to another business, that is another thing. It might certainly make one want to buy used because neck sets are long ways down the road, and who knows where Guild will be 20 years from now. . This does FMIC precious little good. How many old Guilds are there with the original warranty active, Aerohead is absolutely correct.
There is one company that routinely repairs original warranty guitars, including neck sets, and I have 4 of them. The difference is that Martin has not changed hands so
the same business entity that made the warranty still exists.
Now to mellow out listen to this http://www.youtube.com/watch?v=M5rVgxmekeM with more on stage acoustic Guilds than I have ever seen. It has been posted before.


Harmony H-173 bought in 1960 (retired), Alvarez AC60S 2008, Eastman AC320ce 2008 "Hybrid", Guild D25M 1974, Martin Grand J35E 2009, Martin D12-20 1970, Martin OM-21 2009, Martin 00-15M Custom (full body gloss, wide neck) 2011, Voyage-air VAOM-06 2010
"I'm glad there are a lot of guitar players pursuing technique as diligently as they possibly can, because it leaves this whole other area open to people like me."
Richard Thompson

 

[fronobulax]

At LMG 2011 a Fender employee stated to the best of his knowledge Fender did NOT purchase the liabilities of Guild and thus had no legal obligation to honor so called "lifetime" warranties that predated Fender's purchase of Guild. He couched the statement in the usual "I'm not a lawyer and I'm not authorized to commit the company in this matter" but the statement is about as authoritative as we are going to get until someone with a legitimate pre-Fender warranty claim sends their lawyer to talk to Fender's lawyer. Personally I don't see that happening since a) lawyers cost both sides money; b) Fender has been considering pre-Fender warranty claims on a case by case basis and honoring some of them anyway; and c) giving someone a warranty repair that Fender is not legally required to do is cheaper for Fender than getting a lawyer involved.

If you think Fender should honor older warranties because that would be the nice thing to do then they are already doing that, keeping in mind that not everything that can go wrong with a guitar is a defect in materials and workmanship and thus covered by anyone's warranty. If you think they should be compelled to honor warranties then I suggest you become an advocate for changes in the law because that is about the only thing that can compel and require Fender to behave the way you would like them to.

 

[chazmo]

Frono, I heard what you heard. The management panel at LMG2 did say that.

However, there's more than just the paper with regard to this debate. I think I mentioned this way back, but it's more than just "nice" of Guild to honor warrantee claims for pre-Fender Guilds...

It's a question of reputation and competition. Taylor, for example, sometimes will fix a guitar even when the warrantee doesn't apply (not the first owner, for example, or some catastrophic damage). Taylor has totally upped the bar in this area, and Fender will kill new Guild sales if they simply ignore it.

But, that said, I think the point for the membership to take away is that it's going to come down to a Fender-authorized representative evaluating the guitar and then escalating through Scottsdale to authorize the repair or ship it somewhere (such as New Hartford). To my knowledge, this escalation path has always been the process with Guild as part of Fender. We have occasionally seen our members get directly in touch with folks from Nashville, but that connection doesn't exist anymore. We have some connections at New Hartford, but as frono said I don't think that's going to be particularly relevant for older Guilds.

 

[fronobulax]

However, there's more than just the paper with regard to this debate. I think I mentioned this way back, but it's more than just "nice" of Guild to honor warrantee claims for pre-Fender Guilds...

It's a question of reputation and competition. Taylor, for example, sometimes will fix a guitar even when the warrantee doesn't apply (not the first owner, for example, or some catastrophic damage). Taylor has totally upped the bar in this area, and Fender will kill new Guild sales if they simply ignore it.

Violent agreement time.

I will split all the hairs needed to distinguish between what Fender is required by law to do and what they choose to do because it makes good business sense. So long as we agree that honoring a warranty on a pre-Fender Guild is a choice Fender makes and not something they are compelled by law to do then we're OK.

I am not suggesting that the computer business is comparable to the guitar business, but I no longer deal with Dell because of their warranty policies. The clock starts ticking on the day the computer is shipped - with no grace period for transit times - so when you call for service on the 366th day after it left the factory you get your choice of a bill or a broken computer.

 

[chazmo]

Violent agreement time.

Cool.

[HumongousVeer] sorry: Wow, yeah, the computer biz vs. guitar biz... very interesting stuff. So, what do you buy, Jamie? HP? HP tries to differentiate their product by basically customizing everything that's visible to system administrators. I really dread when I have to use an HP because it's very unfamiliar to me. I can sit down at any Dell and treat it just like an Intel white-box, figure out the BIOS settings, etc... But an HP is a different story. [/HumongousVeer]

So, I guess the parallel to guitars is that the products matter, not just the service story. And, true, purchasing a guitar isn't just for the warrantee. But, purchasing a *new* guitar might just be! That's where computers are significantly different. Nobody's buying vintage computers as a viable option to new (well, nobody who's trying to get work done, that is ).

 

[fronobulax]

[HumongousVeer]

[HumongousVeer]The last two computers I bought with my own money were HPs. Before that was an Acer and before that were Dells. HP probably gets the first shot at the next one although who knows if they will still be in the laptop business? (Because of my professional activities, I pretty much have to be on a Windows platform. I'll look at Apples when I retire and no longer spend my days in a Windows world). When you talk about blade chassis and servers or rack mount servers that someone else paid for, I've had to manage both HP and Dell and it is a coin toss for me. I tell people to price things as commodities and buy the cheapest one.[/HumongousVeer]

There are lots of ways to compete in the marketplace and it is never clear, except in hindsight, when it is best to do what the competition does and when it is best to be different. Maybe I don't have to compete on service if the initial cost is significantly lower. In the case of guitars some of the things that differentiate brands are reputation, tonal qualities, country of origin, and initial cost. Warranty and "ease of repair/service" and resale value do not seem to be the first things people look at when choosing a guitar Brand for a new purchase although they certainly are factors of importance.

 

[capnjuan]

Hmm ....

If prior to the sale, Guild had put itself in Bankruptcy, then a Trustee would have been appointed to find/ID assets, collect receivables, identify all secured creditors if any, and look for a buyer for the assets. Anybody at the time who was an original owner of a Guild guitar and had, by virtue of paying a purchase premium, an unsecured claim for pre-paid repairs (a warranty) ... they were all wiped out and the expression 'bought the assets but not the liabilities' makes some sense.

If prior to the sale, Guild hadn't put itself into Bankruptcy and management accepted Fender's offer to buy the company (take the owners out from under the Liabilities), then Fender would have demanded and received an Indemnity from the prior owners for (commonly) '... all claims arising out of or related to Guild operations ... ' up to the date of the sale.

Otherwise, Fender would have had no protection against then-previously unknown 'slip and fall', 'wrongful termination', 'your guitar made my kid sick', or similar claims. Fender would have gotten some protection from claims at the time of the sale about which neither party knew and, arguably, those claims would have included future bona fide warranty claims.

Whether Guild was ever in Chapter 11 is a matter of public record in whichever US Bankruptcy court the filing took place ... if there was one. If there wasn't a Bankruptcy, then somebody out there ... the former Guild owners ... are on the warranty hook to those original guitar owners who have bona fide claims.

I know several ex-Guild biggies have paraded through here in the last 4 years. Funny how all of them .... who had anything to say at all ... said: "Everything was fine while I was there"