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Nokia accused of selling faulty phones

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Summary:
A US judge will hear allegations that Nokia was ‘deceptive and misleading’ in its advertising and knowingly sold mobile phones with defective displays

A team of US attorneys representing California resident Henry La filed an amended class-action law suit against Nokia in the state’s Superior Court on Friday. It contained allegations that some of Nokia’s most popular mobile phones including the 32xx, 51xx, 61xx, 82xx and 88xx series carried a common design defect.

Counsel representing La claim the alleged defect caused the phones’ displays to fade or disappear with “substantial regularity” and that Nokia has been aware of the defect’s existence since at least 1998.

La purchased a Nokia 8290 — the US equivalent of Nokia’s 8210 — in February 2001 and experienced display problems consistent with the allegations. La’s legal counsel wants California’s Superior Court to recognise La case as a class-action claiming that his phone was among the number of models Nokia released carrying the alleged defect.

If the class-action is successful the court may order Nokia to hand over millions of dollars worth of profits to compensate consumers and stop selling some of its mobile phone range.

Counsel representing La originally filed their complaint in May 2002.

Based on its allegations, La’s counsel argued that Nokia had violated Californian competition and consumer laws, breached its warranty and asked the court to compensate consumers under the Song-Beverley Consumer Warranty Act.

La’s counsel told the court that Nokia had engaged in deceptive and misleading advertising by marketing the phones carrying the alleged defect as capable of carrying out their functions and violated the phones’ express warranty terms as they allege the phones were not sold free of defects.

Counsel representing Nokia asked the Superior Court Judge Victoria Chaney to dismiss the complaints. Nokia was partially successful in dismissing La’s complaint that the company breached its warranty but upheld his request to have the court test whether the terms of warranty were unconscionable.

Judge Chaney granted La’s legal counsel leave to amend its complaint that Nokia engaged in deceptive and misleading advertising practices.

La’s legal counsel has greatly expanded the list of allegations it first filed in its complaint in May last year. The amended complaint contains new allegations similar to claims made by a former employee of Nokia Australia and local mobile phone dealers who spoke to ZDNet Australia in the second-half of 2001.

In November 2001, the former employee alleged that the design faults affected a broad range of Nokia handsets built after the company retired the Nokia 2110, suggesting it may have failed to address purported design flaws for up to six years.

La’s counsel claims the problem associated with the alleged design defects were so pervasive that Nokia conducted focus groups and a study to compare the cost of fixing it at the factory and dealing with resulting display failures on an after-sales basis.

“Unfortunately for mobile consumers, Nokia chose to deny the existence of and otherwise conceal the defect from consumers,” wrote the counsel for La in their list of allegations.

La’s team of attorneys have also closely examined Nokia’s brush with Australian consumer authorities last year, when Nokia admitted to selling a batch of 8210 handsets carrying a low quality display component.

La’s legal representatives allege the incident demonstrates the company has concealed the extent of the alleged defect’s impact on its phone series.

At the time, Nokia said that the 8210 handset containing the low quality display component were manufactured between October 2001 and January 2002. However, the California court was told that an Australian Fair Trading organisation began its investigation prior to October 2001, on 4 September.

Craig Hilliwig of legal firm Kohn Swift Graf, said counsel representing La has requested Nokia’s files on Australia’s Fair Trading investigation. However, according to Hilliwig, Nokia is resisting the request to disclose the documents. Nokia claims the defective component affecting 8210s sold in Australia was not installed in the 8290s sold in the US.

NSW Fair Trading ordered Nokia to repair all 8210s sold in Australia exhibiting display faults.

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