INSERTING and REPLACING Minnesota Homeowners Join National Litigation Against Carrier Corporation For Concealing Alleged Defects In High-Efficiency Carrier, Bryant, Payne and Day & Night Furnaces

MINNESOTA HOMEOWNERS JOIN NATIONAL LITIGATION AGAINST CARRIER CORPORATION FOR CONCEALING ALLEGED DEFECTS IN HIGH-EFFICIENCY CARRIER, BRYANT, PAYNE AND DAY & NIGHT FURNACES

Class counsel announced that homeowners in Minnesota today filed a class action lawsuit against Carrier Corporation, the manufacturer of Carrier high efficiency condensing furnaces. The homeowners allege that, beginning in 1989, Carrier stopped manufacturing its high-efficiency condensing furnaces with high-grade stainless steel and instead used plastic-coated mild steel that corrodes and fails well before the industry standard and expected life of 20 years. Carrier has never disclosed this problem to its customers, the suit further alleges. The case was filed on behalf of an estimated 150,000 residents of Minnesota who own or owned these furnaces manufactured by Carrier and sold under the Carrier, Bryant, Day & Night, and Payne brand-names.

"My furnace failed in the middle of January when it was 20 degrees outside," said James Nogosek of Winona, Minnesota, one of the plaintiffs. The technician who examined Mr. Nogosek's furnace told him the furnace failed due to the "poor quality parts" Carrier used.

"Minnesota homeowners often run their furnaces a good part of the year," stated Vincent J. Esades of Heins, Mills & Olson, P.L.C. of Minneapolis, one of the firms representing plaintiffs. "It is of great concern that Carrier would sell a furnace that could potentially malfunction in the dead of winter well before the end of their expected and warranted life."

"Carrier's high efficiency furnaces are defectively designed and will fail prematurely regardless of installation or maintenance," said Kim D. Stephens, plaintiffs' counsel with the Seattle law firm of Tousley Brain Stephens PLLC.

"Carrier's warranty does not cover labor charges for replacement of the part they knew would fail," explained Jonathan D. Selbin, plaintiffs' counsel with the national law firm of Lieff Cabraser Heimann & Bernstein, LLP. "Homeowners who bought their furnace on the assurance by Carrier that it would last a lifetime have been forced to spend hundreds or even over a thousand dollars on the repair of their faulty furnace, or have had to spend thousands on a brand new furnace."

Today's lawsuit marks the fifth class action lawsuit filed against Carrier Corporation for failing to disclose defects in its furnaces. In 2005, homeowners in the State of Washington filed suit, followed by homeowners in 2006 in Wisconsin, Michigan and Ontario, Canada. On May 1, 2007, U.S. District Court Judge Ronald B. Leighton ordered that the case on behalf of Washington homeowners may proceed as a class action lawsuit.

Factual Allegations

High-efficiency condensing (or 90%) furnaces maximize efficiency by employing a second heat exchanger to extract more heat from the hot gases through condensation. These furnaces are typically more expensive than non-condensing (or 80%) furnaces.

The class action complaints in each case allege that, in 1989, Carrier stopped using high-grade stainless steel secondary heat exchangers in favor of cheaper polypropylene laminated ("PPL") mild steel. The complaints allege that Carrier knew from before it sold the first furnace that the PPL degrades and disintegrates due to the high temperatures in the furnace, exposing the underlying mild steel to corrosive acidic condensate. In some cases, the corrosion proceeds to the point of actually perforating the outside wall of the heat exchanger.

The industry standard was (and still is) to use high grade stainless steel for condensing heat exchangers to prevent corrosion. The complaints charge that Carrier has never disclosed to consumers that the new heat exchangers are not as robust as ones manufactured from stainless steel or that their furnaces would not last as long as consumers typically expect.

How Consumers Have Been Harmed and Can Learn More About The Case

In the United States, Carrier warrants the heat exchanger for the lifetime of the original purchaser and for 20 years for subsequent purchasers. Despite this warranty, the complaint charges that Carrier's condensing furnaces fail prematurely and well before their warranted and expected life, resulting in consumers having to incur substantial charges on the labor to repair their furnace or on the purchase of a new furnace.