“Wet Out” is new issue that happens when you have gear with Gore Tex, Hipora, E-Vent or another liner material. The liners do a great job preventing you from getting wet, but the outer shell still gets soaked. This eventually happens with all gear except rubber rain coats.
You may still be “dry”, but riding with a soggy jacket is not fun. Jackets that do wet out also lose breathability, so you will sweat. Once you sweat, it is just a matter of time before you get cold. Nobody wants to ride soggy and cold.
When a coat is brand new it should repel water. After a little while, it will lose its repellent properties and you can test this by pouring a glass of water on the fabric. This happens because most manufactures use something called DWR. DWR is simply durable water repellent. These repellents are applied in the manufacturing process and are mainly a super hydrophobic coating.
As a consumer, these coatings can actually be re-applied and it will not affect your warranty with JUDGED. The coatings are also relatively inexpensive, so apply liberally and every few months.