Mar. 03, 2000 (Computer Reseller News - CMP via COMTEX) -- Beaumont,
Texas - Compaq Computer Corp. was the first to fight and first to fall.
The Houston-based PC maker late last month acknowledged possible
floppy disk interface problems with its Presario PCs and released a
software patch, Softpaq No. 13456. The company is now attempting to
contact 1.7 million desktop Presario PC owners.
Toshiba Corp. was the first PC vendor charged with faulty floppy disk
controllers last November by Beaumont law firm Reaud, Morgan & Quinn
Inc. Tokyo-based Toshiba settled the case for approximately $2.1
billion.
Following the Toshiba suit, Wayne Reaud, who is heading the series of
lawsuits, implicated Compaq, Hewlett-Packard Co., Packard Bell NEC Inc.
and eMachines Inc. for similar faulty drive controllers.
Despite the patch, Compaq continued to vehemently deny all
allegations made in the lawsuit.
"Our position remains the same," said a spokesman for Compaq. "We do
not believe there is a problem, and no customer has brought to our
attention any problems."
Compaq posted the patch on its Web site following testing that turned
up possible problems in extreme situations, the spokesman said.
The lawsuit against Compaq, HP, Packard Bell NEC and eMachines
alleges the PC makers knowingly used the faulty drive technology and
ignored warnings as early as 1990 when NEC Corp. ran advertisements
warning of a "killer bug hidden in the microcode of many 765-compatible
floppy disk controllers."
A spokesman for Reaud said Compaq recently filed a barrage of
motions, which were all subsequently denied in court. One motion was a
gag order against the media to prevent discussion of the case.
No attempts have been made to monetarily reconcile the case, the
spokesman said.
"The motions are just a lot of jockeying for position," said the
Compaq spokesman. "We intend to defend ourselves vigorously."
"This could shake consumers' confidence in Compaq," said Jody
Palacios, sales manager of Chesapeake, Va.-based Computer Systems
International. "In an industry that is so competitive, this is the last
thing that they need."
Last November, Tim Scannell, an analyst with Mountain View,
Calif.-based Mobile Insights Inc., said the lawsuits, which were dubbed
copycats, are nuisance suits.
"Toshiba should not have settled, but it made good business sense,"
Scannell said. "Toshiba could not duplicate the problem internally in
their lab, so they elected to settle out of court because the time and
delay would have been worse in the long run if they would have fought
it."
Court records indicate Compaq has not submitted additional lines of
PCs for testing. None of the other PC vendors named in the suit have
publicly responded to the allegations or made attempts to acknowledge
fault.
If Compaq decides to settle the case, its customers could receive
similar rewards as those reaped by Toshiba customers. As part of the
Toshiba settlement, notebook customers were entitled to rewards of
between $210 and $433 per notebook if purchased by a certain date.
Other customers were entitled to a software patch and $255 toward
additional Toshiba products. If customers were not satisfied with
monetary settlements, Toshiba was forced to replace the faulty external
floppy disk drives.
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