California Sues Microsoft For Xbox 360 Failures
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California is taking on Microsoft once again, this time taking on the failure rate of their Xbox 360 units. The lawsuit alleges that Microsoft knew that 50% of their unit would fail. The lawsuit also says that Microsoft didn’t care since it was attempting to challenge PS3 and Wii for the game console leadership.
It seems that Microsoft has not done very well for itself when it comes to game consoles. They originally had to cover the cost of repairing the consoles and spent over $1 billion doing that. I recall they also extended the warranty from 1 yr. to 3 years, Now this.
I’m sure other states will follow.
One thing that I don’t fully understand. California is asking for all of the profits that Microsoft has made while selling the Xbox 360. Am I reading this right?

9 Comments
James Edwards
October 19th, 2008
at 4:16pm
Screw California…
A. Nonny Mouse
October 20th, 2008
at 1:21am
Screw Microsoft PS3 pwns 360
Christopher Hurlburt
October 20th, 2008
at 12:01pm
I have not read the complaint, so I cannot be sure, but the consumer protection statutes of most states permit the “disgorgement” of profits earned on defective merchandise if a sufficient level of bad faith is established on the part of the seller. CA is likely requesting profits under a provision of their code which permits their recovery if the seller’s conduct is particularly egregious. I am an Ohio attorney and there are provisions in our code which permit punitive damages in certain cases, as measured by [X] formula. CA’s provisions likely use proifts earned as a benchmark to compute their damages.
So, yes, you are probably reading it right. It does not pay to mess with consumers. Commercial purchasers, on the other hand, enjoy far less protection. So, if you are in the business of playing fast and loose with quality control, you should probably hedge your bets on the business sector…
Ron Schenone
October 20th, 2008
at 12:33pm
Hello Christopher,
Thanks for the clarification.
Robert John Vantz
October 25th, 2008
at 3:23pm
they fix it for free get over yourself
Edward Hackan
October 26th, 2008
at 10:35am
This may be coming from a jaded consumer. But this is my second console… my first one, I was flat out told by microsoft that the problems with the system were not covered under warentee and had to go out and buy another one. (the system was purchased upon its initial release (first release of the system that christmas). It had strong over heating issues and locked up anywhere from 10 to 20 minutes of use every time i turned it on, and then eventually red ringed (system worked fine for 2 months). But they told me it was not covered. So I ended up getting an Elite edition two years later…. My system just RRODed on me this morning.
Fortunately as you said they will fix it. But I think the big deal here is that the company has in fact sold defective product to people. The system is a big investment to me and its frustrating (as I was frustrated with the Sony (PS2) when, and on their initial release of the system flat out told people that the problems were not their problem. If they changed their warrentee program within the first few weeks, then I would not have an issue because I would think thats resonsible for a company to try and take care of their consumers… but they took a LONG time to finally admit to a problem and set up that warrentee program, which shafts people who bought the system when it was first released in 2005. A company sells defective product, and it is a large sink hole in regards to people’s wallets.
I support the lawsuite because I don’t support shafting an entire customer base. When you shaft a customer base, people look for product else where, and thats less people I can interact with via X-box live. My problem with the suite is that I enjoy the 360s game selection, and if the company gets hurt, then that runs a possibility of ruining a good thing. At least those are my two cents.
Ron Schenone
October 26th, 2008
at 5:07pm
Hi Edward,
Thanks for sharing your experience with us. It is appreciated.
Regards, Ron
Mario Rueda
October 31st, 2008
at 10:15am
Hopefully someone sees my view.
High five(s) Edward Hacken. You really hit the mark.
2006 I bought my 1st 360, $530 cash w/ many accessories. I knew nothing about RROD until AFTER my 1st 360 was freezing up, I turned it into the store & recieved a new one. All was well until 10 mo. later RROD. This was in early 07′, I can’t spend my entire time after work browsing the web looking up Warranties. Working 10hr. days doing an honest work like construction, I just want to chill after work. It was an honest mistake that, I opened my 360 to try & fix it, over-looking the MS Warranty. Needless to say, I voided that warranty. I went ahead & fixed it myself, then 2-mo. later, RROD. I sold my broken 360 for $90. I havent been sorry since.
When I get the chance, I tell as many people as I can about my ordeal & MS sells a poor product. I also think, since the store was able to take my $530 cash AND my name & address, I should of recieved some kind of notice with the XBOX 360 or something in the mail. I hope the M$ gets whats coming to them.
Sorry Robert John Vantz, but I just dont agree with your statement.
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at 6:55pm
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