News19,135 Articles

October 13, 2008

Microsoft sues DHL over 21,000 lost Xboxes

Games consoles damages in train derailment

Elizabeth Montalbano

Microsoft is suing DHL Express, claiming that the cargo-delivery service lost 21,600 Xbox game consoles.

According to court documents, Microsoft is suing the US-based cargo-delivery service for losing 21,600 Xbox game consoles because of a train derailment in Texas.

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In a complaint filed in the US District Court for the Western District of Washington in Seattle, Microsoft said it is seeking more than $2m in damages from DHL for two containers of Xbox consoles that sustained "impact damage, wetting, pilfering and shortage" after a derailment near Duke, Texas.

The Xboxes were en route from a Microsoft office in McAllen, Texas, to Long Beach, California, for eventual delivery to Hong Kong at the time of the loss, which occurred on October 13, 2007, according to court papers. Flextronics Industrial in Hong Kong was the intended recipient.

Microsoft claims that DHL has refused to compensate it for the loss, even though the delivery service "negligently breached its duties as a common carrier, handler, bailee, warehouseman, agent, or in other capabilities", according to the court papers.

DHL could not be reached for comment last week.

Microsoft's Xbox game consoles also were the centre of a recent controversy in Colorado, where a man was indicted on September 23 for illegally reselling both Xbox 360 and Sony Playstation consoles, and returning inoperable consoles to retail and online outlets for money as if he had purchased them legally.

According to the US State Attorney's Office in the District of Colorado, 27-year-old Yewchoo Ng of Boulder purchased the consoles at Target, Amazon.com, Buy.com, Best Buy, Circuit City, Sears and Wal-mart using several credit cards. He took the consoles out of the boxes, removed the serial numbers, put those numbers on older, inoperable consoles, and returned those consoles to the retail outlets, according to the state attorney's office.

The retail and online outlets lost $182,001 as a result of the scam, the office said. Ng also sold the new consoles online via eBay and other auction and shopping sites for his own personal profit.

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