The intent of Minnesota’s right to repair law (Digital Fair Repair Act, Minn. Stat. § 325E.72) is to lift the digital curtain that currently prevents customers of electronic devices, including manufacturing equipment, from repairing and maintaining the equipment themselves. The law requires, with significant exclusions (e.g., video games, medical devices, motor vehicles, off road equipment, turf/garden equipment, etc.), that original equipment manufacturers (OEMs) provide the information and tools necessary to repair and maintain the equipment or product. The law also does not apply to any repair that would require a license under Minn. Stat. § 326B (e.g., plumbing, electrical, boiler, elevator, etc.)
This note offers suggestions for how manufacturers can use this new right to repair law to their advantage by lowering downtime and perhaps updating their maintenance procedures for higher utilization. However, like all government policies that alter incentives in private markets and come out of contentious committee meetings, unintended consequences lurk as this law is understood and reacted to by OEMs. In my view, several legal challenges are highly likely, and I think we will see higher prices and more potential injury incidents as a result of this new law.
The Basics
Statutory Name
- Digital Fair Repair Act
- Minn. Stat. § 325E.72
Effective Date
- July 1, 2024
Function
- Allows purchasers of digital equipment and devices access to the necessary tools and information, at a reasonable price, to repair and maintain the equipment.
- This would include disabling tools for security locks (note: how this would work with cell phones, laptops, and computers is unknown.)
Equipment/Products Covered
- Products made after July 1, 2021.
Exclusions
- Video game consoles, medical gear, motor vehicles and off-road or nonroad equipment, including without limitation farm and utility tractors; farm implements; farm machinery; forestry equipment; industrial equipment; utility equipment; construction equipment; compact construction equipment; road-building equipment; electronic vehicle charging infrastructure equipment; mining equipment; turf, yard, and garden equipment; outdoor power equipment; portable generators; marine, all-terrain sports, and recreational vehicles, including without limitation racing vehicles; stand-alone or integrated stationary or mobile internal combustion engines; generator sets and fuel cell power; power tools; and any tools, technology, attachments, accessories, components, and repair parts for any of the foregoing.
For Manufacturers as Consumers: Focus on Programable Logic Controllers and Similar Devices Such as QC Vision Systems
Most factory production equipment is sold with the base unit, tools, safety stock for wear items, and perhaps most importantly a Programable Logic Controller (PLC). PLCs orchestrate the machine’s operations according to how it was programmed. While PLCs allow for central control and coordination, they also create a single point of failure. In other words, if the PLC is down, the machine is down, and nothing is made. The Minnesota right to repair law should allow for access to tools and information for assessing the entire range of machine parameters (including the input/output logic) controlled by the PLC (note: an OEM might push back citing the right to withhold trade secrets).
The new right to repair law would also include repair access for other typical manufacturing systems such as vision systems for quality control. The goal offered by the right to repair law is to create a system that allows for better anticipatory maintenance on the machine (including the PLC itself) thereby facilitating such maintenance in a timely way and, as a consequence, lower overall costs. Ideally, this would create an option for manufacturers to set up a real-time dashboard that monitors the relative health of each machine so that unscheduled downtime is essentially eliminated.
Prepare Your Operations Team
The right to repair law will not be effective for about a year. This gives the ecosystem of customers, OEMs, direct dealers, and distributors time to plan and adjust to this new set of rights that has been handed to purchasers of manufacturing equipment. The assumption is that the necessary information will be provided online using a platform like MaintainX or Fiix. But note that OEMs are required to offer a paper option if requested by the customer. So, it is a good idea to make a list of machinery and equipment covered by the right to repair law and then consider requesting paper copies of any repair documentation you want to have on hand for your organization.
Once you have your list of covered machinery/equipment, consider the next steps to take full advantage of an enhanced digital repair function in your operations. Consider this action plan:
- Survey and understand in detail the costs of unscheduled downtime and how it relates to malfunctioning PLCs or similar digital components that do not require a state license to repair.
- Evaluate whether taking the maintenance of digital components in-house would provide an advantage.
- If your organization cannot commit to this long-term, it may not be worth it.
- Consult your machinery/equipment list and plan your request for information and tools from the manufacturers/sellers.
- Often there are capabilities in PLCs that are “turned off,” which forces an added maintenance cost on you the manufacturer.
- See if you can identify any of these capabilities ahead of time.
- Think broadly in terms of what would be required to do all of the maintenance of the machine that is or could be controlled by a digital device.
Lingering Questions and Potential Consequences
On the surface, this new right to repair law seems to be just what tinkerers and small manufacturers need. However, it will likely create some unintended consequences and lingering issues. Here are some initial concerns raised by the right to repair law.
- The right to repair statute provides no guidance as to the technical skill requirements that can be assumed on the part of the OEM when providing the tools and information necessary to do maintenance or a repair. Is the standard such that they can provide a schematic that would be understood by a person of ordinary skill in the particular art, or should the information be understandable by someone will no skill in the art? (Note, the law requires specific licensure to do a repair if otherwise required.)
- If the standard is comprehensibility by someone unskilled in the art, this would be too heavy a burden and potentially raises major risk and safety issues that were surely not intended by the authors. It is stating the obvious, but repairs can be done correctly or incorrectly. If a consumer performs repairs incorrectly while following the information provided by the OEM, the inevitable lawsuit will follow.
- Although the right to repair law provides a shield for OEMs against claims arising out of repairs that are done by a consumer/owner, the shield is vague and incomplete. For example, the liability shield does not cover design or failure to warn liability theories. It would also seem not to cover situations where there is shared fault. Given all of this, there is a very heavy burden on the part of the OEM to anticipate misuse or misinterpretation on the part of the consumer/owner, thus requiring the repair and information package to be very dense, very technical, and very specific.
- The right to repair law could create incentives on the part of OEMs to find a replacement for repair model revenue elsewhere. The right to repair law naturally is silent regarding prices. But it is clear that OEMs have many options to make up for potentially lost revenue from their current service and repair models, including raising prices on the original machine, spare parts, and emergency service calls, or they could require expensive specialized or “authorized” parts as part of any recommended repair.
- There is no hard time limit to the OEM’s duty. The obligation to provide repair information and related tools and parts is open ended as long as the OEM has access to such repair parts and maintenance tools. This may lead to highly artificial, but nevertheless legal, commercial behavior. For example, a parent company may have the equipment made by one subsidiary and the repair parts made by another subsidiary. In order to quash the right to repair obligation the parts subsidiary may simply stop making the repair parts.
- The economics of right to repair laws was recently highlighted in the Harvard Business Review – click here to read more.
- One of the exclusions in the law is listed as “industrial equipment.” As is often the case with contentious legislation, key terms are overlooked. “Industrial equipment” is one of those terms because arguably, everything under the factory roof is industrial equipment, and an OEM would likely make this argument if challenged. The context of this subsection seems to indicate it refers to machinery that has a motor and a dedicated purpose like a fork-lift, trenchers, mobile platforms, and the like, but it is not clear.
A frank conversation with your manufacturer’s representative would seem to be in order to make sure the overall economics of doing your own digital repairs would make sense, including all the necessary cybersecurity measures and patches.
A Final Word
There is a broader context to the development of Minnesota’s right to repair law, and there has been a systematic effort by a broad coalition of consumer advocacy groups seeking to drive OEM’s to provide all the information needed to repair most products in the marketplace. For example, see https://pirg.org/?s=right+to+repair, which is a link to one advocacy group’s site focused on what it describes as marketplace challenges. Minnesota’s right to repair policy could be seen as a material disincentive to research and development, and there is a concern that the vast majority of consumers are simply unskilled to make such repairs. I also worry that practical, skills-based secondary education has long been in decline.
The legislative history of Minnesota’s version of right to repair shows it is aimed mainly at cell phones, computers, and home appliances. However, it will have a broader practical application that will affect manufacturers as consumers of products with digital elements. Ultimately, I anticipate two primary consequences from the implementation of right to repair in Minnesota: higher prices for certain goods and a rise in injuries related to improper repairs by consumers.
Please reach out to Jim Seifert and our Manufacturing Practice Group. We would be glad to discuss the right to repair or any other legal issues your manufacturing organization or business may be dealing with right now.
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