Newly released court documents have alleged that Dell knew about and covered up problems with millions of computers in 2003 and 2004. On Thursday, Dell responded on its company blog that the problems were related to faulty capacitors provided by its supplier, adding that it "did not knowingly ship faulty motherboards." The problematic products are the subject of a three-year-old civil lawsuit against the computer maker.
Dell spokesperson Lionel Menchaca wrote on the company blog that the quality of the capacitors was "not a Dell-specific issue, but an industry-wide problem" from supplier Nichicon. According to documents recently unsealed in the lawsuit by Advanced Internet Technologies (A.I.T.), Dell sold at least 11.8 million computers that could have failed or did fail because of the capacitors.
Hewlett-Packard and Apple also used components and had problems with some of their products, but, if the lawsuit's figures are accurate, the magnitude of the problem was much greater at Dell.
'Avoid All Language'
The company noted that it had extended the warranty up to five years for customers with faulty machines, and that no safety issues were involved. However, industry experts contend that problematic capacitors could have led to fires.
A.I.T., an Internet services company, said it lost millions of dollars in business because of 2,000 faulty computers it bought from Dell. According to documents in the lawsuit, Dell examined the bad computers and said A.I.T. had essentially caused many of the problems by using them too heavily in a space with a high room temperature.
The lawsuit contends that Dell knew about the problems, but tried to cover them up. An e-mail among customer-support staff, recently released in the lawsuit, stated that employees "need to avoid all language indicating the boards were bad or had 'issues.'" Other e-mails directed employees to "emphasize uncertainty," and to avoid bringing motherboard problems to the attention of the customer.
An internal study by the computer company found the OptiPlex computers were expected to fail up to 97 percent of the time. Dell documents in the lawsuit indicate that a contractor the company hired to investigate the problem found that the number of computers affected were 10 times Dell's estimate.
Dell Buys Scalent
Among the Dell customers who purchased the OptiPlex computers were the law firm of Alston & Bird, which is representing Dell in this suit.
In other Dell news, the company announced Thursday that it has signed an agreement to buy Scalent, a maker of software for managing data centers. Dell said it would integrate Scalent's technology with its Advanced Infrastructure Manager solution. The financial terms of the acquisition were not announced.
Brad Anderson, Dell senior vice president of the enterprise product group, said integrating Scalent with Dell's products will "provide increased efficiency and value for our customers" when utilized with Dell servers, storage and network platforms.
The computer giant said Scalent will provide "a critical building block" in helping customers take advantage of the "virtual era" in technology, with the goal of cutting data-center management costs by as much as half.