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IBM Class Action Suit Filed

 

Date: June 29, 2002

 

IN THE SIXTH CIRCUIT COURT

PINELLAS COUNTY, FLORIDA

___________________________________

                                                                        :

XXXXXXXXXX, on behalf of                         :

himself and all others similarly situated,  :           Civil Action No.

                                                                        :

            Plaintiffs,                                  :

v.                                                         :           CLASS REPRESENTATION

                                                                        :

INTERNATIONAL BUSINESS                     :

MACHINES, INC.,                                         :           JURY TRIAL DEMANDED

                                                                        :

Defendant.                               :

___________________________________  :

 

Plaintiff, by and through his undersigned attorneys, hereby complains against International Business Machines, Inc. (“IBM” or “defendant”) on behalf of himself and the proposed class, upon information and belief, except as to his own actions, the investigation of his counsel, and the facts that are a matter of public record, as follows:

OVERVIEW

1.                  Plaintiff XXXXXXXX files this class action, on behalf of himself and all others similarly situated to obtain damages, restitution, and injunctive relief for the Class, as defined infra at ¶14, from IBM.

2.                  As alleged more fully herein, IBM has made misrepresentations and concealed material information in the marketing, advertising, and sale of a consumer computer component, the Deskstar 75GXP Hard Disk Drive, Model Numbers DTLA-307015, 307020, 307030, 307045, 307060, and 307075 (the “Deskstar 75GXP”). 

3.                  In particular, IBM represented to plaintiff and members of the class that the Deskstar 75GXP is a safe and reliable disk drive for accessing and storing data on a personal computer; that it was free from defects; and that it was of merchantable quality and workmanship.  Plaintiff's experiences, mirroring those of thousands of other 75GXP purchasers who have recounted their problems with the Deskstar 75GXP, reveal that is not the case.

4.                  IBM further specifically represented that the Deskstar 75GXP would perform within certain reliability specifications.  It demonstrably does not.

5.                  Defendant similarly concealed material facts regarding the Deskstar 75GXP, including that it fails at unacceptably high rates, is inherently defective and is not a reliable storage device, is not of merchantable quality, and does not conform to the specifications it purports to comply with.

6.                  Owing to defendant’s false and misleading statements and concealments, plaintiff and the Class bought thousands of Deskstar 75GXPs, stored their vital (and in many cases invaluable and irreplaceable) computer data on them, and many times lost that data without warning, when their Deskstar 75GXPs malfunctioned.

7.                  Though faced with thousands of consumer complaints of failures and data loss with the Deskstar 75GXP, IBM has failed and refused to warn consumers about the defects inherent in the drive.  Apparently unwilling to admit fault, IBM sat silent while consumers bought this defective product, knowing that it would malfunction resulting in, among other things, loss of valuable data.  To this day, IBM has never warned its 75GXP customers that they should be particularly vigilant in preserving essential files on another device because of the 75GXP’s likelihood of failure.

8.                  Plaintiff asserts claims under the Florida Deceptive and Unfair Trade Practices Act, for breaches of express and implied warranties, and unjust enrichment.  Plaintiff seeks actual damages, restitution, equitable relief, including the replacement and/or recall of the defective hard disk drive, costs and expenses of litigation, including attorneys’ fees, and all further relief available.

THE PARTIES

9.                  Plaintiff XXXXXXX (“Plaintiff”) resides in Dunedin, Pinellas County, Florida.  Plaintiff purchased a Deskstar 75GXP drive in 2000 for a consumer purpose, and experienced drive failure.  Plaintiff subsequently obtained a warranty replacement 75GXP drive that also failed.  Plaintiff then obtained second warranty replacement 75GXP drive that failed.  Despite plaintiff’s request, IBM has refused to refund plaintiff’s money.

10.              Defendant International Business Machines, Inc., is a corporation organized and existing under the laws of the State of New York, with its principal place of business located at New Orchard Road, Armonk, New York.  Defendant’s division responsible for the design, manufacture, distribution, marketing, sale, advertisement and customer service of the Deskstar 75GXP, the IBM Storage Systems Division, is located at 5600 Cottle Road in San Jose, California.

JURISDICTION AND VENUE

11.              This action is brought to remedy violations of the Florida Deceptive and Unfair Trade Practices Act, for breaches of express and implied warranties, and unjust enrichment in connection with defendant’s misconduct as it relates to its design, manufacture, distribution, marketing, sale, advertisement and customer service of the Deskstar 75GXP.

12.              This Court has jurisdiction over this action pursuant to Fla. Stat. § 26.012.  The amount in controversy for plaintiff individually does not exceed $75,000.00.

13.              Venue is proper in this Court pursuant to Fl. Stat. §§ 47.011 and 47.051, in that the property at issue in located in, and the cause of action accrued in, Pinellas County.  

CLASS REPRESENTATION ALLEGATIONS

14.              Plaintiff brings this class action pursuant to Fla. R. Civ. P. 1.220(b)(3) on behalf of himself and all others similarly situated, with the Class being defined as follows:

All persons who purchased at retail in the State of Florida, a Deskstar 75GXP Hard Disk Drive, including those who purchased it as a pre-installed component of an assembled system.

 

15.              The members of the Class are so numerous that joinder of all members would be impracticable.  Plaintiff estimates that there are several thousand purchasers of the products at issue.

16.              Plaintiff's raise questions of law and fact common to the questions of law or fact raised by the claims of each member of the class, and which predominate over any questions affecting only individual members, including:

a.                   Whether the Deskstar 75GXP fails at unacceptably high rates, is inherently defective and is not of merchantable quality;

b.                  Whether IBM made false and/or misleading statements of fact to the Class and the public concerning the defects inherent in the Deskstar 75GXP;

c.                   Whether IBM knew, or was reckless in not knowing, that its statements of fact to the Class and the public about the performance and reliability of the Deskstar 75GXP were false and/or misleading;

d.                  Whether IBM concealed from the Class and the public that the Deskstar 75GXP fails at unacceptably high rates, is inherently defective and is not of merchantable quality;

e.                   Whether the Deskstar 75GXP fails to conform to IBM’s Official Public Specifications, which were published and advertised to the Class and the public;

f.                    Whether IBM concealed from the Class and the public that the Deskstar 75GXP does not conform to IBM’s Official Public Specifications;

g.                   Whether IBM’s false and/or misleading statements of fact to the Class and the public about the performance and reliability Deskstar 75GXP, and its concealment of material facts, were likely to deceive the public;

h.                   Whether, by its misconduct as set forth herein, IBM has engaged in unfair or unlawful business practices with respect to the advertising, marketing and sale of the Deskstar 75GXP;

i.                     Whether, by its misconduct as set forth herein, IBM has engaged in unfair, deceptive, untrue, or misleading advertising of the Deskstar 75GXP;

j.                    Whether defendant has breached its express warranty to the Class for the Deskstar 75GXP;

k.                  Whether defendant has breached the implied warranty of merchantability to the Class for the Deskstar 75GXP; and

l.                     Whether, as a result of defendant’s misconduct, plaintiff and the Class are entitled to damages, restitution, equitable relief and other relief, and the amount and nature of such relief.

17.              The claims of plaintiff are typical of the claims of the members of the Class.  Plaintiff alleges that IBM’s course of conduct as alleged below violated the Florida Deceptive and Unfair Trade Practices Act, and breached implied and express warranties, as to plaintiff and each member of the Class.  Plaintiff has no interests antagonistic to those of the Class, and defendant has no defenses unique to plaintiff.

18.              Plaintiff will fairly and adequately protect the interests of the Class, and has retained attorneys experienced in class and complex litigation.

19.              The common issues of law and fact relate to IBM’s actions and omissions directed at Plaintiff and the entire class, and predominate over any issues that might apply only to the claims of individual class members.

20.              A class action is superior to other available methods for the fair and efficient adjudication of this controversy for the following reasons:

a.                  It is economically impractical for members of the Class to prosecute individual actions;

b.                  The Class is readily definable;

c.                  Plaintiff is seeking final equitable relief with respect to the entire class;

d.                  Prosecution as a class action will eliminate the possibility of repetitious litigation;

e.                  To the best of Plaintiff’s knowledge and information, there is no pending litigation to which any member of the class is a party and in which any question of law or fact controverted in the subject action is to be adjudicated; and

f.                    Concentration the litigation in this forum is desirable, as Plaintiff asserts claims on behalf of all Florida residents who fall within the Class definition.

21.              A class action will cause an orderly and expeditious administration of the claims of the Class.  Economies of time, effort, and expense will be fostered and uniformity of decisions will be ensured.

22.              Plaintiff does not anticipate any difficulty in the management of this litigation.

SUBSTANTIVE ALLEGATIONS

23.              IBM is one of the largest manufacturers of desktop computers and other computer products in the world.  Among the products it manufacturers and sells are hard disk drives (“HDD”). IBM designed, manufactured, distributed, marketed and advertised a product line of HDDs known as the Deskstar 75GXP.  It is that product that is the subject of this lawsuit.

24.              The HDD is the “data center” of a computer system.  It is the primary device for the storage of data and software, and thus is central to the function of today’s computer systems. 

25.              An HDD is a “stand-alone” computer component that contains one or more platters upon which data is stored and read.  The HDD’s motor spins the platters at speeds ranging from 3,600 to 15,000 rotations per minute.  Data is read from and written to the HDD by read/write heads, which float above and below each platter as the platter spins.

26.              Modern software and the data generated by such software, including audio, video, and other multimedia content, requires substantial disk space, thus making larger hard disks a sought after computer commodity.

27.              Owing to the massive amounts of computer data generated and collected by consumers, the storage capacity of a given HDD is an equally important feature in the consumer HDD market.  Storage capacity is measured in terms of the number of bytes of data that the HDD is capable of storing.  One kilobyte is 1,024 bytes; one megabyte is 1,024 kilobytes; and one gigabyte is 1,024 megabytes.

28.              Over the last several years, the storage capacity of HDDs has doubled approximately every 18 months.  At the same time, average selling prices have sharply dropped. This trend has resulted in thin margins and intense competition for manufacturers of consumer HDDs.

29.              As a result, HDD manufacturers, including IBM, Maxtor, and Seagate, raced to release larger and larger storage capacities to the personal computer consumer market, which has exhibited strong demand for increased HDD storage capacity.  The first HDD manufacturer to introduce HDDs with significantly greater capacity owns a tremendous competitive advantage in the marketplace, including market exclusivity as to that product’s market niche (as well as all of the sales that result from such exclusivity).

30.              IBM historically has been an aggressive competitor in the consumer HDD market through its practice of introducing new HDD models with increasing storage capacities and faster speeds.

31.              In March 2000, IBM announced with great fanfare the introduction of the Deskstar 75GXP.  In a press release disseminated from its San Jose, California Storage Division headquarters, IBM’s headline read, “IBM announces world’s highest capacity drive.”  The Company touted the 75GXP as holding a “whopping 75-gigabytes (GB), more than 10 times the capacity of drives found in the average home PC.”

32.              Upon its release, the 75GXP became the only 75 GB hard disk drive on the market.  At the time, IBM was well aware that its primary competitor was only months from releasing an 80 GB HDD.  IBM released the 75 GB HDD to leap ahead of the competition and gain sales that otherwise would have gone to competitors.   The 75GXP remained the only 75 GB hard disk drive on the market for several months after its release, until a competitor introduced an HDD of equivalent size.  Even four months after its release, IBM’s marketing director boasted, “The IBM 75GXP remains the highest capacity disk drive in the entire hard drive market since its introduction in March.”

33.              However, in the process, IBM failed to adequately design, manufacture, and/or test the 75GXP to ensure that it was free from defects.  Before its 75GXP hard drive even reached the market, IBM knew, or was reckless in not knowing, that the 75GXP (a) failed at unacceptably high rates; (b) contained inherent defects; and (c) was not of merchantable quality.

34.              In spite of its knowledge, IBM marketed the 75GXP as a remarkably reliable drive, and made specific factual and technical representations to create this perception in the marketplace.

35.              Because of the essential function that an HDD plays in storing data, its reliability is of critical importance.  If an HDD experiences a failure, one of the consequences of the failure could be the complete loss of the data residing on the HDD.  Defendant is and at all times relevant hereto has been aware that the reliability of an HDD is its single most important product characteristic.

36.              Knowing that its customers cared first and foremost about the reliability of computer hard drives, IBM touted “high reliability” as an essential feature and distinct advantage of the 75GXP hard drive.  Defendant represented that it was able to manage the factors that contribute to high reliability and to predict the results based on design, component selection, development test process, manufacturing test process, and system design.

37.              To support the perception that the 75GXP is a highly reliable HDD, defendant published Official Public Specifications for the product, which misdescribed its specific, factual characteristics.  Touting the 75GXP’s reliability, IBM represented -- under the heading “RELIABILITY” -- that the 75GXP would operate within certain fundamental reliability specifications, e.g.:

·                    The nonrecoverable error rate for the 75GXP is 1 in 1013 (i.e. 1 in 10,000,000,000,000 attempted tries)

·                    The 75GXP would withstand a minimum of 40,000 start/stop cycles

These technical specifications relate directly and explicitly to the ability of the 75GXP hard drive to function without losing data, crashing, or becoming inoperable.

38.              In fact, defendant represented in its written warranty that the 75GXP would conform to these Official Public Specifications.  Contrary to defendant’s specific representations, however, the 75GXP fails to recover data within the tolerances represented in defendant’s technical specifications.  Similarly, the 75GXP is unable to withstand the minimum start/stop cycles touted by defendant.  The 75GXP thus fails to meet the specifications IBM advertised for the product, which specifications were intended by IBM to serve as a basis for consumers evaluating the dependability of the drives.

39.              IBM’s warranty further represented that the 75GXP was free from defects in material and workmanship.  Contrary to defendant’s representation, the 75GXP is not free from defects in material and workmanship.  At the time these statements were made, defendant knew, or was reckless in not knowing, that the 75GXP was defective and failed at rates well in excess of those that even IBM states are unacceptable. 

40.              In its press release announcing the 75GXP, IBM highlighted the technology enabling its industry-leading 75 gigabyte capacity, assuring that the same technology led to improved reliability over its then-current line of drives: “Greater areal density allows more information to be stored in less space, producing a drive that is more reliable . . .” 

41.              Defendant’s representations regarding its design and manufacturing processes generally, and the reliability of the 75GXP HDD specifically, were intended to and did convey to consumers (falsely) that the 75GXP was no less reliable than other HDDs on the market, e.g.:

a.         IBM’s disk drives feature industry-leading soft and hard error rates (also known as recoverable and nonrecoverable error rates);

b.         IBM’s TrueTrack technology enhances hard disk drive reliability;

c.         IBM’s No ID-Sector format enhances hard disk drive reliability;

d.         A thermal monitor helps ensure and increase data reliability;

e.         ECC on-the-fly provides the advantage of high reliability;

f.          The 75GXP’s Glass Substrate Disks improve data integrity, extend disk lifetime, and enable new levels of disk drive reliability; and

g.         The IBM Deskstar disk drives stand out among the others in terms of performance, capacity, and reliability.

42.              Similarly, IBM posted a white paper on its website throughout the period that the 75GXP was sold, entitled “IBM hard disk drive reliability.”  The IBM white paper boasted of the care taken to ensure that its drives would be virtually free from failure in actual use.  The white paper emphasized that IBM “has the processes, controls, tools, and personnel to deliver the most reliable disk drives in the industry.”  This white paper, which generally related to IBM’s design process for all of its HDDs, described qualities and characteristics purportedly incorporated in the 75GXP, but which in actuality were plainly absent.

43.              IBM’s actions underscore that the 75GXP is not more reliable than IBM’s predecessor line of HDDs, nor of those of any other HDD manufacturer.  Following the commencement of this action, IBM ceased selling the defective 75GXP, substituting the 60GXP line of HDDs as its high-end drive, notwithstanding that the 60GXP was a lower capacity drive.

44.              Defendant knew, or was reckless in not knowing, that the representations regarding the 75GXP, as set forth above, were false, misleading, and likely to deceive members of the public when those representations were made.

45.              Computer technicians familiar with the 75GXP and the current and former HDD offerings of IBM and its competitors, report that they have never experienced drives fail with the frequency of the 75GXP.  Many bulk purchasers of 75GXP hard drives have experienced failure rates greater than 50%.

46.              When the defects manifest by the sudden occurrence of a loud clicking or scratching noise, the Deskstar 75GXP stops operating and “crashes.” The result of a crash is the irreversible and permanent loss of data and software programs installed on the Deskstar.  Under any definition of the term “reliable,” whether as used in the industry or as commonly used, the 75GXP is not reliable.

47.              Far from innocuous or isolated, thousands of end-users have complained to IBM and on Internet web sites about failures with the drive.  Postings on the various sites confirm the widespread extent and destructive nature of the 75GXP malfunction.  For example:

a.         “I went out and bought myself a nice 60GB IBM Deskstar 75GXP . . . hard drive to put in my sparkling new computer.  Boy was that a mistake!  A few months after I got the drive, it failed with horrific grinding and clicking noises, plus random data loss.  So I RMA’d the first one and got a ‘SERVICEABLE USED PART’ replacement from IBM, which died of the same death after another few months.  Not getting the hint, I RMA’d that one.  Last week, I got the refab. drive back from IBM and it has already died, in less than a week!”  (http://slashdot.org.)

 

b.         “I have G4  [¶]  Two Dtla 45 Gig drive. They both died after 7 months of use.  [¶]  1 died in fourth month and the another 7th.  [¶]  Lost all of my datas.. My life work.  [¶] [I] refuse to [return it] it. because I have alot of important datas in here.  [¶]  Saving up my money to get my datas back.” (http://tech-report.com)

 

c.         “By ironic coincidence, the day the IBM Deskstar Failures story was posted, both my 40 gig 75GXP drives failed. Whilst I don't have the cure for cancer on there, I do have some personal data that I'd really like to try to recover. No way could I afford to have it recovered by a professional data recovery company. I looked at a few software packages, the most promising one being ACR Mediatools, the demo version available only shows you your lost files though, you have to register ($499) to actually recover them.”          (http://slashdot.org)

 

d.         “I’ve had a pair of IBM Deskstar 30.0GB drives for about 6 months now, and recently my computer started getting RAID O bad strip errors, i.e., lose everything because one of the drives fail.  I reformatted, and RAIDed again, which worked for about 2 weeks, before the RAID failed again.  I finally set up just 2 drives separately, and now, I can open a specific file and get the infamous cat scratch sound.”  (http://forums.anandtech.com (General Hardware Forum)).

 

48.              The enormity of the 75GXP hard drive defects is further underscored by the businesses and institutions with significant computer storage requirements presently faced with decisions regarding replacing unreliable IBM Deskstar hard drives.  For instance, on October 10, 2001, a web-hosting service provider posted the following statement on its website:

We are planning to proactively swap out failure-prone hard drives on nearly seventy of our servers within the next three weeks.  Based on an amazingly high failure rate, as well as published reports of known problems with the drive model in question, we believe that this will be the best step to avoid costly failures and downtime.  The drives in question are part of IBM’s Deskstar 75GXP line.(http://pair.com/pair/support/notices/driveswaps.html (Emphasis added)).

 

49.              Yet, even after receiving an extraordinary number of complaints from purchasers and users of the 75GXP complaining of the same type of failures, defendant has refused to disclose or warn users of the defects in the 75GXP drives and the accompanying damage or loss of data and applications. Although defendant was aware of the problems with the 75GXP early in its product life cycle, it never sought to warn its customers. Rather, IBM has consistently represented that there is nothing wrong with the performance of the drives.  In August 2001, Info World Daily reported the following:

Users of IBM’s Deskstar 75GXP 75GB disk drives are reporting abnormally high failure rates for the product, according to industry sources.  But IBM officials said the problems are within the range of normal failure rates.

 

50.              To this day, defendant continues to conceal material information from users, consumers, and the public, through its customer service representatives and media releases, that (a) the drives fail at unacceptably high rates; (b) the drives are inherently defective; and (c) the drives are not of merchantable quality.  The drives are of such a low quality and are so defective that IBM knows they consistently fail and that consumers may lose massive amounts of information, time, and money upon the failure of each drive.  Nevertheless, IBM has refused to disclose to customers the existence of the defects and the injuries caused thereby, including the loss of information and software without warning.

51.              In the end, the harm caused by defendant’s false and misleading affirmative statements and omissions grossly outweighs any benefit that could be attributed to them.

FIRST CAUSE OF ACTION

(Violation of Florida Deceptive and Unfair Trade Practices Act)

 

52.              Plaintiff incorporates the above allegations by reference as if set forth herein at length.

53.              Plaintiff and each member of the Class are “consumers” within the meaning of Fla. Stat. § 501.203(7).

54.              IBM's advertising, distribution and sale of the Deskstar 75GXP HDDs that plaintiff and each member of the Class own constitutes “trade or commerce” within the meaning of Fla. Stat. § 501.203(8).

55.              Defendant has committed unfair and deceptive practices in at least the following respects:

a.                  Defendant has represented that the Deskstar 75GXP is of a particular standard, quality, or grade when it is not;

b.                  Defendant has advertised Deskstar 75GXP HDDs with an intent not to sell them as advertised;

c.                  Defendant has represented that Deskstar 75GXP HDDs have characteristics, uses and benefits that they do not have;

d.                  Defendant failed to reveal material facts, the omission of which tends to mislead or deceive a reasonable consumer, and which facts could not reasonably be known by the consumer;

e.                  Defendant made representations or statements of fact material to the transaction such that a person reasonably believes the represented or suggested state of affairs to be other than it actually is;

f.                    Defendant failed to reveal facts that are material to the transaction in light of representations of fact made in a positive manner;

g.                  Defendant breached its express warranty.

56.              Defendant’s failure to disclose the 75GXP’s inability to perform its advertised functions, and its conscious concealment of the inherent defects in the 75GXP, are omissions and concealments of material fact that constitute unfair and deceptive practices in the conduct of trade or commerce in violation of Fla. Stat. § 501.204.

57.              As a direct and proximate result of IBM’s violation of the Florida Deceptive and Unfair Trade Practices Act, plaintiff and the other Class members have suffered losses and monetary damages.  Plaintiff, on behalf of himself and on behalf of the Class, seeks damages, injunctive relief and all other relief allowable Fla. Stat. § 501.211.

SECOND CAUSE OF ACTION

(Breach of Express Warranty)

58.              Plaintiff incorporates the above allegations by reference as if set forth herein at length.

59.              For each 75GXP hard drive, IBM issued an express written warranty that each 75GXP hard drive was free of defects in materials and workmanship and conformed to IBM’s Official Public Specifications.

60.              In addition, by virtue of its campaign focusing on the reliability of the 75GXP, IBM expressly warranted that these hard disk drives were free from the defects complained of herein.

61.              IBM breached its express warranties, as set forth above, by supplying the 75GXP in a defective condition where it does not perform the most basic and essential functions of a hard disk drive, including operating without crashing, failure, and/or massive data loss.

62.              IBM has received timely notice of the breach of warranty alleged herein.  IBM has failed to provide to plaintiff or the Class, as a warranty replacement, a hard drive that conforms to the qualities and characteristics that IBM has expressly warranted are possessed by the 75GXP hard drives.

63.              Despite requests to do so, defendant consistently refuses to repair or replace any drive unless it has already resulted in utter failure or is no longer operable.  As a result, class members who demanded such replacements were forced, and continue to be forced, to await the substantially certain failure of the 75GXP hard drive and suffer the accompanying losses of data, time, and money.

64.              IBM’s warranty further fails of its essential purpose by replacing one defective hard drive with another defective 75GXP hard drive or an inferior model drive.  Plaintiff and many other customers have reported going through this “warranty process” on multiple occasions, just to have the replacement drives fail as well, resulting in additional data loss.  Replacing one defective product with another defective product, or an inferior product, is a breach of warranty.

65.              Applying any warranty limitation to avoid the need to repair this particular defects would be unconscionable in that, inter alia, the 75GXP contained an inherent defects that was already present at the time of purchase and IBM knew, or was reckless in not knowing, about this defects, which could not be discovered by plaintiff and members of the Class at the time of purchase, and purchasers lacked any meaningful choice with respect to the warranty terms.

66.              As a result of IBM’s breach of express warranty, plaintiff and the Class have suffered damages in an amount to be determined at trial.

THIRD CAUSE OF ACTION

(Breach of Implied Warranty of Merchantability)

 

67.              Plaintiff incorporates the above allegations by reference as if set forth herein at length.

68.              Each 75GXP, by operation of law, came with an implied warranty that it was merchantable and fit for the ordinary purpose for which it is used.

69.              By supplying the 75GXP in a condition where it does not perform the most basic and essential functions of a hard disk drive, including operating without crashing, failure, and/or massive data and software loss, IBM breached the implied warranty of merchantability associated with the 75GXP.

70.              IBM has received timely notice of the breach of warranty alleged herein.  IBM has failed to provide to plaintiff or the Class, as a warranty replacement, a hard disk drive that conforms to the qualities and characteristics that IBM has warranted, by operation of law, are possessed by the 75GXP hard disk drives.

71.              IBM’s warranty process fails of its essential purpose by replacing one defective hard drive with another defective 75GXP hard drive or an inferior model drive.  Many customers have reported going through this “warranty process” on multiple occasions, just to have the replacement drives fail as well, resulting in additional data loss.  Replacing one defective product with another defective product, or an inferior product, is a breach of warranty.

72.      As a result of IBM’s breach of implied warranty of merchantability, plaintiff and the Class have suffered damages in an amount to be determined at trial.

FOURTH CAUSE OF ACTION

(Unjust Enrichment)

 

73.              Plaintiff incorporates the above allegations by reference as if set forth herein at length.

74.              As the intended and expected result of its conscious wrongdoing, defendant has profited and benefited from the purchase of Deskstar 75GXP hard drives by plaintiff and the Class.

75.              Defendant has voluntarily accepted and retained these profits and benefits, derived from the plaintiff and the Class, with full knowledge and awareness that, as a result of the defendant’s misconduct, plaintiff and the Class were not receiving products of the quality, nature, fitness, or value that had been represented by defendant, or that plaintiff and the Class, as reasonable consumers, expected.

76.              By virtue of the conscious wrongdoing alleged in this Complaint, defendant has been unjustly enriched at the expense of the plaintiff and the Class. Plaintiff seeks the disgorgement and restitution of defendant’s wrongful profits, revenue, and benefits, to the extent, and in the amount, deemed appropriate by the Court, and such relief as the Court deems just and proper to remedy the defendant’s unjust enrichment.

PRAYER FOR RELIEF

WHEREFORE, plaintiff, on behalf of himself and all others similarly situated, pray for judgment against defendant as follows:

A.                An order certifying this case as a class action and appointing plaintiff and his counsel to represent the Class;

B.                 Restitution and disgorgement of all amounts obtained by defendant as a result of its misconduct, together with interest thereon from the date of payment, to the victims of such violations;

C.                Actual damages for injuries suffered by plaintiff and the Class;

D.                An order requiring IBM to immediately cease its wrongful conduct as set forth above; enjoining IBM from continuing to falsely market and advertise, conceal material information and conduct business via the unlawful and unfair business acts and practices complained of herein; ordering IBM to engage in a corrective notice campaign; and requiring IBM to implement a full replacement program of all defective 75GXP hard disk drives at issue with fully functional hard disk drives of equal or greater specifications;

E.                 For reasonable attorneys' fees and the costs of this action;

F.                 For statutory pre-judgment interest; and

G.                For such other relief at this Court may deem just and proper.

                                                                       

                                                                        Respectfully Submitted:

                                                                        SHELLER, LUDWIG & BADEY, P.C.

            By:       _______________________________

            Scott K. Johnson

                                  1528 Walnut Street, 3rd Floor

                          Philadelphia, PA 19102

                                 Telephone:  (215) 790-7300

                                Facsimile:  (215) 546-0942

                                                            Attorneys for Plaintiff and the Class

 Of Counsel

Jonathan Shub

SHELLER, LUDWIG & BADEY, P.C.

1528 Walnut Street, 3rd Floor

Philadelphia, PA 19102

Telephone:  (215) 790-7300

Facsimile:  (215) 546-0942

 

David R. Buchanan

SEEGER WEISS LLP

One William Street

New York, NY 10004

Telephone:  (212) 584-0700

Facsimile:  (212) 584-0799

 

Marc Edelson

Hoffman & Edelson, LLC

45 W. Court Street

Doylestown, PA  18901

Telephone:  (215) 230-8043

Facsimile:  (215) 230-8735

 

Donald E. Haviland

Kline & Spector, P.C.

1525 Locust Street, 19th Floor

Philadelphia, PA  19102

Telephone:  (215) 772-7000

Facsimile:  (215) 772-1359

 

Michael J. Boni

Kohn, Swift & Graf, P.C.

One South Broad St. – Ste 200

Philadelphia, PA 19107

Telephone: (215) 238-1700

Facsimile: (215) 238-1968

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