Class-Action Lawsuit Filed Against Microsoft, T-Mobile

Server outage loses customer data

Sidekick image from Wikimedia.

Sidekick image from Wikimedia.

Last week, one of the biggest tech companies in the United States experienced a server outage. Several Sidekick smartphone owners lost personal data such as appointment dates, phone numbers and other information when Microsoft’s server went down a couple of weeks ago.

Data services for Sidekick users whose information was stored on a Danger server went down completely Friday, Oct. 2, and slowly returned over the weekend. Three days after the server outage, Microsoft sent a message to users that said “Affected customers should not remove or ‘hard reset’ their device, doing so may cause Address Book and Calendar information to be lost.”

Woman sues over lost data

Naturally, for many, it was too late. All the payday loans in the world can’t make a person’s digital contact list reappear, and an Atlanta woman has filed a class-action lawsuit against Microsoft and Sidekick maker T-Mobile, saying:

Defendants negligently failed to invest the resources, including hardware, software, procedures, maintenance, security, back up procedures, and the training and testing necessary to insure that the functions and operations Defendants assumed would operate to permit Plaintiff and the members of the Class to access and keep safe and secure that data they entrusted to Defendants.

The woman who filed the suit is Maureen Thompson from Atlanta. She says her daughter, an aspiring singer and model, lost appointments, business contacts and song lyrics she had stored on her phone. She filed the lawsuit in U.S. District Court for the Northern District of California and invited any other negatively affected customers who wished to seek damages to join.

Microsoft’s predicament

Microsoft has managed to create products and services that people “need,” which has made the company very, very rich. But as we learned from Spider-Man, “With great power comes great responsibility.”

Microsoft’s ability to develop products that people rely heavily on has made it one of the most powerful companies in the world. Microsoft and other high-tech companies have completely changed the way people conduct business and communicate. I think this lawsuit is going to be tough for Microsoft and T-Mobile, because their only defense will be “You shouldn’t have counted on us.” Not good PR. T-Mobile has issued statements saying the server outage was all Microsoft’s fault.

Will suit be silenced with a settlement?

Because of the damage a trial could do to Microsoft’s reputation, I predict the company will settle the lawsuit out of court. T-Mobile already has offered Sidekick users a free month of service and a $100 gift card. Because the server outage was Microsoft’s fault, T-Mobile might end up getting off the hook.

However, if it’s discovered that the hardware was responsible for data loss or customers were led to believe that the hardware would provide data backup, T-Mobile could end up having to pay damages as well. Both companies can easily afford to pay out-of-court damage settlements to customers, but I don’t think they can afford the cost of the public viewing them as unreliable.