Busy Week for Dell with Legal Issues in New York, New Orleans

Dell found itself the center of news involving legal issues in two states this week, New York and New Orleans. In New York, Dell was fined $4 million for fraudulent and deceptive advertising around PCs sold to consumers. In New Orleans, two companies claim Dell conspired with city officials to sell a surveillance camera system they developed. Dell reportedly said it already had settled many of the cases in New York and has denied the allegations in New Orleans.

Dell is wrapping up a difficult week in the courtroom.

Dell was ordered Sept. 15 to pay a $4 million fine in New York for misleading consumers about financing terms, warranties and rebates on their PCs. Around the same time, the computer maker found itself embroiled in a civil trial in New Orleans involving that city's crime detection cameras.

New York's attorney general's office claimed in a suit filed in 2007 that Dell was deceptive and misleading in its advertising, and that as a result some customers in the state were saddled by high credit rates. A year later, the state's Supreme Court ruled against Dell, finding it guilty of fraud, false advertising and other related charges.

Dell was fined $4 million and agreed to change how it advertised its products as well as its financing practices.

Dell officials had said that they had resolved many of the issues and customer complaints before the settlement.

N.Y. Attorney General Andrew Cuomo was pleased with the settlement.

"Today's announcement is the final step in ensuring New Yorkers harmed by Dell's deceptive and illegal business practices are fully compensated," Cuomo said in a statement announcing the settlement. "Going forward, this deal means that Dell will have to clearly and fully disclose the terms and conditions of their products and services, to avoid this kind of fraud at the consumer's expense."

New Yorkers who want to file a claim for compensation can do so here, according to Cuomo's office.

The case in New Orleans stems from the city's post-Katrina desire to put cameras in high-crime areas. Two companies, Southern Electronics Supply and Active Solutions, claim they had contracted with the city in 2004 to supply the crime camera equipment, but that city officials-including Mayor Ray Nagin-reneged on the deal and misused the companies' technology.

The companies also claim that technology officials in New Orleans conspired with Dell to allow the computer maker to sell their system commercially.

Officials with both Dell and New Orleans denied the accusation.

The trial, which began this week with jury selection, reportedly could run as long as two to three weeks.