Lenovo Inc. has agreed to settle a class action lawsuit over laptops that allegedly connect to wireless Internet slowly or don’t connect at all. As much as $70 million in repair services and reimbursements are included in the settlement. Lenovo will offer up to $49 million in repairs to members of the settlement class who bought 83,000 specific Lenovo Ideapad computers, as well as up to almost $21 million in cash refunds and credit certificates. In a motion for preliminary approval of the settlement, Plaintiffs in the lawsuit say the total value of the settlement will be as much as $70 million.
Settlement class members would include anyone who bought a Lenovo Ideapad model U310 or U410 Ultrabook computer in the United States through the date of the court’s final approval. Interestingly, Lenovo says it hasn’t agreed to pay any particular amount of money in connection with this case.
In February 2013, lead Plaintiff Garrett Kacsuta asked a federal judge for an injunction, plus an award for actual, statutory and punitive damages, alleging that the company’s laptops had a design flaw that made the Wi-Fi cards ineffective for standard Web browsing. It was alleged further that Lenovo’s $50 million advertising campaign told customers that the U Series computers could “handle any mobile computing task” and are “dependable enough to use whenever you want.”
In July 2013, U.S. District Judge Cormac Carney refused to dismiss the lawsuit’s request for a permanent injunction requiring Lenovo to establish a common fund for repairs of its U Series laptops, despite argument from the computer company that its defects were public knowledge prior to their sale. The judge also left intact claims under California’s Unfair Competition Law and Consumer Legal Remedies Act. Interestingly, the Plaintiffs say the court’s dismissal of warranty claims actually weighs in favor of settlement because it left only consumer fraud and unfair competition claims. It will be interesting to see how this settlement ultimately works out.