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Dell deceived customers, judge says

  • Story Highlights
  • Judge rules that Dell failed to deliver on promises of low financing rates
  • Consumers said Dell deprived them of customer service to which they were entitled
  • The court will hold further proceedings to determine restitution
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From Karina Frayter
CNN
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NEW YORK (CNN) -- Dell Inc. deceived customers in a massive "bait and switch" scheme to increase sales of its computer and electronic products, a New York state judge ruled Tuesday.

State Attorney General Andrew Cuomo sued Dell in 2007 on behalf of hundreds of customers who claimed that the electronics company lured them into buying products with promises of attractive deals and promotions.

In reality, the lawsuit alleged, most customers were denied or misled into believing that they had been approved for low interest or financing rates.

The lawsuit also accused Dell of depriving customers of technical support that they were entitled to, in some instances, by pressuring them into performing repairs on their own or subjecting them to long wait times on the phone. Video Watch Cuomo detail the complaints »

In a 26-page decision, Supreme Court Justice Joseph C. Teresi found in favor of the consumers.

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  • Read the judge's ruling (PDF)

"Dell has engaged in repeated misleading, deceptive and unlawful business conduct, including false and deceptive advertising of financing promotions and the terms of warranties, fraudulent, misleading and deceptive practices in credit financing and failure to provide warranty service and rebates," Teresi said in his decision.

The court will hold further proceedings to determine how much restitution Dell will have to pay its customers.

Dell said it disagreed with Teresi's decision.

"Our goal has been, and continues to be, to provide the best customer experience possible," spokesman Jess Blackburn said in a written statement to CNN.

"We are confident that when the proceedings are finally completed, the court will determine that only a relatively small number of customers have been affected," Blackburn said.

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Cuomo hailed the decision in a statement Tuesday.

"For too long at Dell, the promise of customer service was a bait and switch that left thousands of people paying for essentially no service at all," Cuomo said. "We have won an important victory that will force Dell to live up to its responsibilities and pay back its customers for profits that were pocketed but not deserved."

All About Dell Inc.New York State Office of the Attorney General

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