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Dell’s attempt to rebuild its business has taking a stumble after a blistering New York Times article that outlined the company’s trouble problems with bad capacitors from a company call Nichicon. The capacitors were prone to pop and leak fluid causing the company’s Optiplex computers to fail. The issue could also cause the computers to catch fire according to Carey Holzman, a computer expert, who is quoted in the article. Customers were never made aware of the issue because the computers were never recalled.
The bad capacitors affected 11.8 million computers shipped from Dell between May 2003 and July 2005 which led to a lawsuit in 2007 by Advanced Internet Technologies who had purchased 2000 of the computers. In May, an order was granted which removed a protective order on many of the documents involved in the lawsuit. Those documents reveal the depth at which the capacitor problem impacted Dell and its customers.
Ironically, it seems even Dell’s own legal firm, hired to defend against the lawsuit, has been impacted by the bad computers. That detail came up in email messages introduced as evidence during the case.
Dell did announce in 2005 that it was taking a $300 million charge which was partly due to the company’s attempt to fix and replace the computers in question. That doesn’t seem to have appeased Advanced Internet Technology which filed its lawsuit against Dell two years later. The lawsuit is still pending.
