Dell Lawsuit
Dell Class Action Lawsuit in New York
The New York State Attorney General has initiated a Dell Lawsuit against Dell Inc.because of consumer complaints against the PC computer manufacturer, saying that Dell engaged in deceptive consumer financing practices.
The Dell lawsuit, which was filed in New York state court accuses Dell Computer and the financial services company of mis-leading the consmer with very enticing financing and payment offers that ended up carrying many financial restrictions and limitations. The Dell Lawsuit Attorney is asking for an injunction against Dell's financing practices, and is also asking for Settlement Checks for the affected consumers.
The Dell law suit came as "something of a relief following widespread rumors" recently that the impending legal statements from the Attorney General's office would have represented a widerg of existing regulation probe into Dell Computer accounting.
In the Dell lawsuit, the attorney general said that consumers "who purchase Dell's computers often find that most of the benefits and features in Dell's advertisements are false and misleading."
Dell spokesman said Dell would strongly defend it's position and was very confident that the practices will be found to be fair and appropriate for all Dell Lawsuit Settlement Checks.
The Dell lawsuit was filed recently. The Dell Class Action complaint said that the Dell Computer Company offers promotional terms such as a "no-interest" period of financing to computer equipment buyers, the company uses "super restrictive under writing guide lines" that deny most of the consumers, even those with excellent credit records, from qualifying for the financing teaser rate.
Dell Computer Class action also says that Dell makes offers many of those who are denied the promotional financing the regular financing plan under which consumers receive an open line of credit at interest rates that often exceed 20%, the Dell lawsuit said.
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Lawsuit Claims Dell Inflated Corporate Earnings
A class action lawsuit claimed that the technology giant Dell Inc. artificially inflated profits by making secret money payments of about one billion dollars every year from the chip maker Intel Corporation.
The Dell Class Action lawsuit was filed in Dell Lawsuit Court Case on the very same day that the Dell Lawsuit settlement announced that founder Michael Dell would once again return to the CEO position in light of more dismal corporate financial news.
The Dell Lawsuit was Filed in District Court in the home town of Dell battery recall lawsuit. The class action llawsuit also claims that the Dell Computer Company hid financial problems in the accounting and also kept quiet abouth the product quality issues from shareholders lawsuit against Dell. All this occured while the Dell company executives were paid over reaped Three BILLION Dollars from selling their stock options lawsuit.
The Dell Laptop lawsuit spokesman Duane Contrero declined to make a comment recently and wouldn't state whether Dell Computer Corporation year end report that Dell had made secret payments to Intel.
A corporate spokesman for the Intel corporation- who were also named as defendants in the class action lawsuit, said that the Intel company has done no wrong-doing and said that they would continue to fight the lawsuit in a court of law. Intel also said that some of the lawsuit charges "appeared to have been completely made up!" and that the Intel Corporation payments that were made to Dell were legal.
"It's pricing for our products. It's discounting for microprocessors," said the Intel corporate spokesman, Chevy More. "It's like a normal business practice in our industry". Our laptop business methods are both fair and lawful in a court of lawsuit settlement checks."
The lawyer who filed the class action lawsuit said that the lawsuit plaintiffs don't claim that the secret payments were illegal. What they do believe is that Dell cheated the investors by hiding the payments that the company didn't control and gave a misleading financial picture of Dell's financial strength.
Dell Faces Lawsuit over Intel Relationship
After a long week of clamor and commotion at Dell that involved the resignation of its CEO and the reappearance of patriarch Michael Dell, the PC vendor is currently being implicated of fabricating its earnings with help from a covert agreement with Intel.
In the lawsuit, which was filed recently in U.S. District Court in Austin, Texas, several substantial investors assert that between February 2003 and September 2006, Dell executives deluded its financial records and divulged false public allegations about the Round Rock, Texas, PC maker's financial and economic health.
As part of this deception and finagling, the lawsuit claims, Dell was the beneficiary of "hundreds of millions of dollars of hush-hush and likely unlawful rebate/kickback payments Dell received from Intel at the end of each quarter in exchange for contracting to buy 100 percent or virtually 100 percent of its microprocessor inventory requirements from Intel."
That capital helped Dell show basically unlawful profits which helped its stock increase. As Dell tried to extricate itself from future disaster and grapple in the market place as it once did, their executives condoned and encouraged the fraud by disseminating hopeful, bullish optimism while harboring ambiguous facts of their actual earnings for a federal probe, according to the nearly 400-page lawsuit.
The lawsuit, was first reported by the Wall Street Journal, and is the second legal action taken against Dell on behalf of shareholders in the last six months. The law firm filed the recent lawsuit, and also filed the initial lawsuit in September 2006 insisting that company executives had been deceptively masking the bottom line.
In both lawsuits, attorneys for the shareholders claim that Dell had been concealing the fact that the Securities and Exchange Commission had undertaken a probe of its financial accounting practices in August 2005.
"The complaint alleges that by at least August 2005, the defendants were aware of but concealed from investors the fact that the SEC was investigating the Company's revenue recognition and accounting practices," according to a written summary the San Diego-based law firm issued initially, when the first lawsuit was filed in September. The lawsuit also names Dell's account firm, PricewaterhouseCoopers, as a defendant. Michael Dell and Kevin Rollins have also been mentioned in the lawsuit.
The lawsuit suggests another hurdle that Michael Dell will have to refute as he attempts to achieve authority of the company from Rollins, who was obliged to resign as the CEO on Jan. 31—the exact day the second lawsuit was filed. A Dell spokesperson told eWEEK that the company does not comment on developing litigation. Dell is also dealing with diminishing prestige, as competitors like Hewlett-Packard have made tremendous headway in the PC market over the past few years. The company has also been obligated to deal with the recall of more than 4 million of its notebooks that used unreliable, defective lithium-ion batteries made by Sony, as well as the SEC investigation.
Richard Shim, an examiner with IDC, said the lawsuit proceedings will not inflict much damage for the company in the short term, but it could have a significant impact, particularly, if it coincides with the continuing SEC investigation. "It just adds to the escalating negative press on these guys and it raises more concerns about the Kevin Rollins era at Dell," Shim said.
The lawsuit poses certain problems for Intel, which is named as a defendant. The lawsuit states, the company gave Dell a vast sum—approximately $200 million each quarter—to have the company exclusively, without exception use its processors.
An Intel spokesperson told a reporter, after reviewing a preliminary look at the lawsuit, "Some of the allegations are completely made up."
"Overall, we deny the plaintiffs' allegations and we plan to move quickly to defend ourselves," said Chuck Mulloy, a spokesman for Intel, in Santa Clara, Calif. Additionally, he added that his company has not been contacted by either the SEC or the Department of Justice in regarding the purported allegations in the case.
On May 18, 2006, Dell announced that it would begin to provide computers and servers with processors from Advanced Micro Devices, Intel's main competitor in the chip market. While the move was perceived as a boon for customers, the lawsuit purports that the move undermine Dell's profits.
"Due to customer demand for PCs with the advanced features and advantages of the new AMD microprocessor chips, Dell had decided it would have to begin to purchase AMD chips for its computers, which would mean the loss of those hundreds of millions of dollars of rebate/kickback payments from Intel, which would hurt Dell's operating profits and margins," the lawsuit said.
AMD has also filed an antitrust legal action against Intel.
No court date for either Dell lawsuit has been confirmed.
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