Action News Investigation: Lawsuit claims Home Depot not honoring damage protection insurance

PHILADELPHIA (WPVI) -- Home Depot's insurance protections are under the spotlight after complaints from some consumers.

A recent lawsuit may have some thinking twice before renting a tool from the home improvement behemoth.

Justine O'Brien purchased a new stove from Home Depot in July.

But what she didn't prepare for was the additional cost she'd pay for installation damage.

"They drilled a hole right through a water pipe," said O'Brien.

She said the mishap resulted in a $300 plumbing bill and some soggy drywall that needs to be replaced and painted.

She said she received estimates of more than $600.

"On Oct. 14, I got a call that said, 'Your claim has been denied,'" recalled O'Brien. "And that's when I called Channel 6."

USP Home, which handles Home Depot's installation insurance coverage, denied her claim, saying their investigation "failed to reveal liability."

But when our team contacted Home Depot, they changed course. A spokesperson told Action News, "We always want to make sure our customers are taken care of. We thank her for allowing us to make this right."

O'Brien did get a check for the repairs.

But a further investigation into Home Depot has found other insurance and warranty complaints about tool rentals and damage protection.

"This is a nationwide issue and it's been going on for several years," said attorney John Lockett.

A new lawsuit filed by his firm says coverage claims are being unfairly denied.

Lockett and partner Bradley Pratt filed the lawsuit seeking class action certification after a client purchased tool rental protection for a plumbing drain camera.

Tool rental damage protection is usually 15% of a tool rental cost.

Their client paid $20 on a $140 rental.

When the camera got stuck and damaged, the suit claims Home Depot wouldn't pay for it, saying he had abused the equipment and that wasn't covered under the contract.

"What we've discovered through an internal Home Depot document is that the protection is limited to only wear and tear," said Lockett.

That's despite the damage protection contract stating repair and replacement charges are covered under "normal use."

The lawsuit says Home Depot charged the customer more than $3,000 for the damaged plumbing camera and late fees.

"Home Depot is the largest tool rental company in the world," added Pratt. "So it's a huge business and we anticipate we're going to find this is a huge profit center."

Home Depot told Action News it couldn't comment on the pending litigation but has filed a motion to dismiss the lawsuit.

Lockett and Pratt told us they continue to add clients to the class action including one from our area.