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Liquidated Damages

By Ed Foster, Section The Gripelog
Posted on Mon Mar 24, 2008 at 10:00:33 PM PDT

What do you do when you're denied warranty service because the vendor claims your system was damaged by a mythical spill of some liquid? I often hear from people who know they didn't spill the milky substance they are being told has invalidated their warranty, but can't prove it. One reader in such a situation however recently found a way to get his warranty honored, and in the process made a point from the discussions we've had about the questionable value of extended warranties.


Two-and-a-half years ago the reader bought a Toshiba Satellite M45-S355 laptop and a three-year Technology Assurance Plan (TAP) extended warranty at his local CompUSA store. "Last July the system started to have a problem where it wouldn't stay powered up, so I took into the CompUSA to get it fixed under the extended warranty," the reader writes. "Four weeks later it came back, but it still had the same problem. After being on for an hour or so, it would die and it would only power on again after I took the battery out and reinserted it. This time it time it took six weeks before it was declared fixed and returned to me."

On October 22nd the reader received his laptop and discovered immediately that the system still died after a few hours, so the very next day it went back to CompUSA for a third time. He didn't hear anything about it again until shortly before Christmas (he found out later that his laptap had sat at the CompUSA store for weeks before being sent to the Nexicore depot, where all three repairs were done.) And it wasn't good news. "CompUSA called to tell me that they had found evidence of 'customer liquid spill damage' on the motherboard," the reader wrote. "As liquid damage is not covered under TAP's terms and conditions, the extended warranty repair was being declined."

The reader was quite certain that if liquid had been spilled on his laptop, it wasn't the customer who spilled it. "I'm very vigorous about not allowing liquids around my computers, but I can't prove that I never spilled anything on the laptop. I didn't, but I'm sure that there are lots of people who lie about that when they really did spill coffee or soda on it. So how do I prove it, and who do I prove it to? CompUSA is going out of business, so they don't care. Toshiba or Assurant Solutions, the company that's responsible for the TAP program now, are going to believe Nexicore, not me."

To make things seemingly more daunting, when the laptop was finally returned in January, still with the same power problem, Nexicore attached photos purporting to show the damaged motherboard. The vague outlines of what could possibly be a puddle of something can be seen. "I showed it to an expert and he says it look mores like flux than a liquid, which would be consistent with the work Nexicore did on the motherboard the second time they had it. But even opening the laptop again might not prove it one way or the other."

Fortunately, the reader is a fighter and was not about to give up on getting his extended warranty honored. Just before his local CompUSA closed its doors for good, he demanded copies of all their records concerning the attempts to repair his laptop. He also contacted Nexicore and got them to confirm from their records that the motherboard had been worked on both the first and second time it was in, without anyone noticing the supposed liquid damage. "So for me to have caused this alleged liquid damage, I would have had to spill something on it in the 22 hours I had the laptop between Oct. 22 when I picked it up and Oct. 23 when I returned it. So if Nexicore is correct about this being spillage, isn't it a lot more likely it happened at Nexicore or at CompUSA?"

Having assembled his evidence, the reader sent an e-mail with all of it to the president of Assurant Solutions, copying officials at Toshiba and Nexicore as well as me. He demanded they honor his TAP agreement either by finding an authorized Toshiba repair facility other than Nexicore or offering him a cash settlement.

"I got a call the next day after I addressed my letter to Assurant Solutions president, so I guess going to the top works. They offered me replacement value of something like $619, and I suppose that would have been fine if I hadn't been without a laptop for 20 weeks in their 'care' and since July 2007 in total. So I pushed back and they went up to another model that would be $799.99. I debated if I should push for the full price I paid in 2005, $1,500, but I've been without the laptop long enough."

I think Assurant Solutions was wise to make that deal, because the reader was very ready to make a lot more noise about this through me and others in the press. "I knew that if I wanted to I could push this even harder and make a huge case out of this. I would make it an 'industry issue' and point out the whole extended warranty problem, the money gusher that they are for the retail industry but with a poor pay off for the users, like you've been pointing out with flat screen TVs. If the cash cow of extended warranties can be shown to be loosing steam because of terrible service and an inability to fix the products, the financial people will take notice. The retailers and insurance companies do NOT want the message that only idiots and suckers will buy extended warranties on big screen TVs and laptops. That will hurt them all on the bottom line."

Losing out on all that extended warranty money would be spilled milk that the vendors certainly would cry over. So if a vendor is not owning up to their warranty obligations to you, take a leaf out of the reader's book and push them hard. And don't forget to copy me at Foster@gripe2ed.com.

< Autorenewal Lurks in Spyware Doctor | Logitech Mouse Features Get Shifty >


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Liquidated Damages | 8 comments (8 topical) | Post A Comment
Liquids[ Reply to This ] (none / 0) (#1)
by Anonymous User on Wed Mar 26, 2008 at 04:57:27 PM PDT

I am a klutz. On top of that, I am accident-prone. I am extremely and consistently unlucky when it comes to just where a fumbled object goes. I am well aware of these factors. So, when I get a valuable piece of equipment, I take steps. For example, one of my criteria in selecting a model of anything is water resistance. My keyboard is easily cleaned, to the point of being dishwasher safe; If it were not, I'd have gone through seven keyboards since I bought it. I also document the condition of my gear when I get it, and before I send it off for repairs, using a digital camera. And I include copies of it in the package with the device, when I send it for repairs. Anyone who claims I spilled liquid inside the case as a means of denying me warranty coverage will land in court so fast, their head will spin. And I will win. It's an easy way for a company to save money, after all. Instead of fixing your gear and spending money to do so, just inflict some irreparable damage not covered by the warranty on it, claim the customer did the damage, and refuse to spend a penny on repairing it.

[ Reply to This ]


Accidental Damage Coverage[ Reply to This ] (none / 0) (#2)
by tscoff on Thu Mar 27, 2008 at 09:03:28 AM PDT

There are also accidental damage policies out there.  I believe that they cost roughly $50/year with a $100 deductible.  So if something isn't covered under the standard warranty, the accidental damage warranty kicks in.

Make sure that both warranties are with the same company though.  That way they will honor the warranty and fix it no matter what because either way it's their responsibility.

[ Reply to This ]



Warranties - Bah, Humbug.[ Parent | Reply to This ] (none / 0) (#3)
by Anonymous User on Tue Apr 01, 2008 at 03:29:41 AM PDT

Unless you are making a major investment, (investment meaning something appreciating in value over time, like buying a house) buying extended warranties for consumer electronics are a waste of money-and time. Paying extra for buying peace of mind on an item that depreciates in value is ludicrous. There should be a law against extended warranties of this nature; like you all know, these are nothing but cash cows for the seller, not the buyer. You are buying a bunch of printed words on a piece of processed tree pulp-same kind of pulp used for making toilet paper. Knowing that, why do people still WASTE money buying into these warranties? If you are clumsy, try to be more careful or buy cheaper products that suit your needs and can be easily and readily replaced. In real life, there are no guarantees; paying for peace of mind guarantees nothing. If it breaks or you broke it, it's yours, TS. Suck it up, buy a new one, move on and quit whining.

[ Parent | Reply to This ]


Sorry, No Humbug[ Parent | Reply to This ] (none / 0) (#4)
by Anonymous User on Tue Apr 01, 2008 at 06:09:00 AM PDT

Sorry to disagree with Bah, Humbug, but we got an extended warranty on our 65" rear-projection TV when we got it about 5 years ago. Over a year after purchase we started having some major video problems. The repair man came out, fixed the problem (a broken wire), cleaned the insides and hasn't given us any problems since. Also, my wife got a new HP laptop from Frys Electronics, with extended warranty. Had some problems with it after a couple months so back to the store, got a loaner (with that god-awful MicroSloth Vista on it, but that's a different matter) and after a couple weeks, it came back good as new. We always purchase the extended warranties when the cost of the item is much above $600-800. We also don't pay excessive amounts for the warranty. Bottom line... Extended warranties worked for us.

[ Parent | Reply to This ]


Was it worth it though?[ Parent | Reply to This ] (none / 0) (#6)
by Anonymous User on Tue Apr 01, 2008 at 11:30:58 AM PDT

If you add up all you have paid on extended warranties, could you have paid for that single visit by the TV repair person or to have the laptop fixed? You might be surprised that self-insuring is actually a better deal.

[ Parent | Reply to This ]


Amen[ Parent | Reply to This ] (none / 0) (#7)
by Anonymous User on Wed Apr 02, 2008 at 03:10:06 AM PDT

Amen to that. Most consumer electronics are luxuries that most of us can live without or opt for less bells and whistles. (There are a few exceptions of course). But when they try to sell me a $14.95 3 year extended warranty on a cheap (and I may add, disposable) $59.00 DVD player, it doesn't take an advanced degree in rocket science or a committee deliberating for hours to make a decision. When I purchase such a product, I put it through rigorous use for the first 30 days to make sure everything works. If something, no matter how insignificant, does not work as it should, or doesn't act right, back to the store it goes.

[ Parent | Reply to This ]


Apple trying to sneak out of repair[ Reply to This ] (none / 0) (#5)
by Anonymous User on Tue Apr 01, 2008 at 11:28:16 AM PDT

We bought an apple IPOD summer of 06 and it would lock up now and then during transfer. Tried to send it in for repair and they said it had been damaged. There was a place where the back case didn't line up with the front case, about 1cm long, and no more than .3mm. To think that THAT was the reason for our problem was absurd. I took it to the apple store and got a replacement. Same problem. Took it back again, and they reflashed it. Same problem. Turned out that it didn't like being synched on a USB 1.0 port, needed USB 2.0. Never had another problem since I upgraded the computer. But they did their best to blame ME for the problem.

[ Reply to This ]


video converter software[ Reply to This ] (none / 0) (#8)
by Anonymous User on Tue May 06, 2008 at 12:49:22 AM PDT

Here is Video Converter Download dot com. you can download Video Converter here, and also you can download DVD Ripper, DVD Creator, DVD to iPod, DVD to MP4. The FLV to WMV site you can find software to convert FLV to WMV, FLV to AVI MPEG WMV 3GP MP4 iPod converter, Free FLV to WMV converter, FLV to WMV converter video files, How to convert FLV to WMV. More useful software for you video movie entertainment: iPod Converter, Video Edit Software, Video editor, Video Cutter, Video Splitter, Video Joiner, AVI to iPod, convert DVD to iPod, convert AVI to iPod, convert WMV to iPod, convert MPEG to iPod, convert FLV to iPod, WinXmedia AVI MPEG iPod converter, AVI to iPod softwares free download, iPod to PC transfer, iPod to Mac transfer, DVD maker, AVI to DVD, MPEG to DVD, DVD Audio ripper, YouTube to iPod converter, iPod rip, iPod Movie converter, DVD to 3GP, 3GP Video Converter, DVD to Zune, Zune Converter, Convert WMV to FLV , Convert FLV to WMV MPG MPEG, FLV Video Converter, Video to FLV Converter, YouTube FLV in WMV, DVD to PSP, PSP converter, MP4 to MP3, DVD to iPhone, iPhone converter, DVD to Apple TV, Apple TV converter, DVD to WMV converter, DVD to DivX, DivX to DVD

[ Reply to This ]


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