Microsoft Is Being Sued Over the Xbox One's Warranty-Void-if-Removed Sticker

"The goal is to intimidate consumers and repair organizations and deceive them into thinking that that a warranty is void if anybody other than Microsoft opens up the box."

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Nov 9 2018, 9:22pm

Image: iFixit

Microsoft is being sued for a security seal on the Xbox One console that can scare consumers into thinking that opening the device will void the warranty.

Earlier this year, the Federal Trade Commission sent warning letters to six companies, including Microsoft, telling them that they were violating the federal Magnuson-Moss Warranty Act, a 1975 law that forbids manufacturers from tying warranty coverage to the use of that company’s repair parts. Now, the company is being sued by a customer and this will be tested in court.

In a lawsuit filed in the Superior Court of California on November 6, plaintiff Charley Baskett is seeking an injunction against Microsoft so it will stop the practice. The lawsuit points out that Microsoft offers a one year warranty on its new Xboxes, but that it “continues to make multiple representations to consumers that the Xbox warranty is subject to carve outs expressly prohibited by federal law.”

In Xbox One product manual available online, Microsoft explicitly tells its customers not to attempt repairs of their own console: “Evidence of any attempt to open and/ or modify the Xbox console, Kinect sensor, power supply or accessories, including any peeling, puncturing, or removal of any of the labels, will void the Limited Warranty and render the Xbox One, Kinect sensor, power supply or accessories ineligible for authorized repair,” the Xbox One manual reads.

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Image: Microsoft

The Magnuson–Moss Warranty Act forbids these types of policies, as well as the warranty-void-if-removed security stickers that are placed over screws or seams in video game consoles. After being warned by the FTC, both Sony and Nintendo altered their policy and updated their documentation online. Microsoft, apparently, has not.

“The goal is to intimidate consumers and repair organizations and deceive them into thinking that that a warranty is void if anybody other than Microsoft opens up the box,” David Slade, an attorney at the law firm Carney Bates & Pulliam—the firm representing Baskett in his lawsuit—told me over the phone.

“I think that there are a bunch of different self-serving reasons why an OEM would want to control the repair process,” Slade said. “But one of them is that that there are all of these different ways in which they want to steer customers towards continuing to buy the new models. Be it planned obsolescence...or to reinforce that planned obsolescence—a repair bill that is commensurate with the new product.”

Right to repair activists have told Motherboard that these stickers and policies are designed to intimidate customers into thinking that they are unable to fix their own devices.

“We’re just asking for an injunction. We don’t want to seek damages,” Slade said. “This is one guy seeking public injunctive relief. He’s just trying to get Microsoft to stop misrepresenting consumers’ rights under state and federal law. All we’re trying to do is remove the misrepresentations and cure the omissions. This is a very surgical case meant to cure a bad business practice.”

Manufacturers such as John Deere, Apple, and Microsoft have fought against right to repair legislation that has been introduced in 19 states that would make it easier for consumers to repair their devices. It’s in their business interests to push consumers with broken devices to either use their repair services or buy a new device. “A win [for this lawsuit] is a repair industry that can tell consumers that this [repair] will not void your warranty,” Slade said. “And a consumer base that understands that, if they want it, they can take their products and get them repaired by anybody.”

Microsoft did not respond to request for comment.