What the court decided
In Niedermeier v. FCA US LLC (case S266034, decided March 4, 2024), the buyer took her Jeep to authorized repair shops 16 times over four years without a fix, then traded it in for $19,000. A lower court had cut her award by that amount.
The California Supreme Court reversed. It held that neither a trade-in credit nor sale proceeds reduce the restitution owed under the lemon law, at least when the buyer had to trade in or sell the vehicle because the manufacturer did not meet its obligations.
What can still be subtracted
- The law still lets the manufacturer reduce restitution for the buyer’s use of the vehicle before its first repair visit for the problem (the mileage offset).
- For manufacturers that opted into the newer procedures (Code of Civil Procedure 871.20 and after), section 871.27 adds its own offsets, such as certain third-party add-ons and negative equity from an earlier vehicle.
What it means for you
If you had to get rid of a vehicle that kept failing, what you received for it does not, by that fact alone, come out of the refund. Keep the trade-in or sale paperwork with your repair orders; an attorney will need both to work out the numbers.
This post is general information about California law as of the date above, not legal advice about your situation.