This year, Dell settled a Federal District lawsuit in North Carolina from Advanced Internet Technologies. The Internet services company sought to recover damages for 2,000[1] Dell computers the company bought. Advanced accused Dell of ignoring its obligation to fix the defective computers. The company claims it lost millions of dollars in business because of the problem. The amount of this settlement is undisclosed.
Faulty Parts Cause Problems for Many
The trouble at Dell began with batches of faulty Asian capacitors. These components control electrical flow within computer parts of the motherboard. The capacitors would overheat, swell, and leak fluids, causing malfunctions and sometimes total failure of the computers.
Only Dell Tries to Cover Up the Problem
Although other computer makers like Apple and Hewlett Packard also suffered from bad components, those companies chose to face the problem. They pulled faulty computers from the market and chose to fix those computers that were already sold. Yet Dell kept buying and using the faulty parts, all the while trying to hide the truth from consumers.
Court documents released to the public three months after the settlement showed that Dell shipped 21 million computers with the defective capacitors between 2003 and 2005.[2] The company claims to have replaced the motherboards for 22 percent of the computers. However, the company’s own internal study revealed that between 45 and 97 percent of those computers were prone to fail within three years. This puts Dell’s efforts well short of consumer needs.
Despite the obvious defects, Dell assured customers that the parts would not cause any harm. The company told customers there would be no fire risk or loss of data. Only one of those statements was true. Although there were no fires reported, many customers reported loss of data.
Preferential Treatment for Certain Customers
As defective claims mounted, Dell resorted to triaging customers by level of importance. They gave priority to clients who might take their business elsewhere. Those who the company believed would make fewer computer purchases came next. Those who were bothered by the problem but obviously loyal to Dell received the lowest priority.
Shockingly, the company refused to recall defective systems. Instead, customers who met certain sales and failure thresholds received replacements. Some important organizations that did not receive this preferential treatment included the City of New York, Microsoft, General Electric, Backus Hospital, Denison University and the Montana Justice Department. The City of New York filed a report with Dell indicating approximately 20% of the computers in a batch of 5,000 were defective. Microsoft bought 2,800 computers and complained of failures in 11 percent of the machines. Dozens of other corporations reported similar problems.
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If your business or organization suffered losses from defective Dell computers, or systems from another manufacturer, contact our office. Our experienced attorneys will provide a free case evaluation to determine your potential to recover damages for the lost business, repairs and replacements.
[1] http://www.nytimes.com/2010/09/25/technology/25dell.html?ref=defectiveproducts
[2] http://www.nytimes.com/2010/11/19/technology/19docs.html?ref=defectiveproducts
