Though Samsung's Note7 is now officially off shelves, the headaches are not yet over. Beyond the continued, embarrassing efforts to keep the phones off of planes and the expected loss of over $3 billion, Samsung will now be dealing with legal troubles related to the Note7 as well. Consumers in the United States and South Korea have just announced their intent to file class action lawsuits.
The American case will not proceed until a judge approves its class action status, which requires the consumers to show that a large number of people were affected in similar ways to the people named in the lawsuit.
Their claim is that Samsung breached its warranty and good faith as well as committing common law fraud in the concealment and distortion of information.
The particular issues here are that by complying with Samsung's request to power down the phones until they could be exchanged, the consumers say they were left without a phone for days or weeks while Samsung struggled to come up with replacements. The specific financial loss, then, is that they had to continue paying for their cellular plans and payment plans for the phone while they waited, effectively phoneless.
The lawsuit claims Note7 buyers collectively racked up millions of dollars in costs that they should not have been responsible for during this time in which they were instructed not to use the Note7 in spite of Samsung's lack of replacements.
While the customers were eventually given the option to get the perfectly safe S7 or S7 Edge along with partial refund, the suit points out that these phones are not quite as "technologically advanced" as the Note7 and so customers could be reasonably expected to hold out for the model they bought in the first place.
The claim of dishonesty is rooted in the argument that Samsung misrepresented the anticipated wait time for replacements and that sales continued for some time after Samsung knew the phones were unsafe and, later, would be discontinued.
Samsung is put in tough position in the sense that once the company knew it had a problem, it had to get people to quit using the phones regardless of the availability of replacements. Judgments on the timing of replacements and discontinuation needed to be made accurately and quickly, but wrongly recalling or killing off the phone would have also hurt the company badly if it later found the situation to be salvageable.
Expect Samsung to also point to the fact the consumers could have or still should take up these complaints with the carriers, to whom the money was actually owed.
South Korean Lawsuit
The South Koreans are not basing their lawsuit on financial damages, but rather inconvenience. They are calling for the equivalent of $267 in restitution to each person in the class due to the extreme pain in the behind of having owned the Note7.
They say the ability to exchange the phone for a replacement or get a refund doesn't make up for two big problems: the time spent and the worrying suffered.
Requiring the customers to make so many trips to stores for dropoffs, consultations, pickups, and the like is one part of the claim; it shouldn't be so difficult just to own the device, basically.
And setting aside the inconvenience, the anxiety suffered from the fear that they were carrying around a literal ticking time bomb also justifies some compensation—at least, that's what the plaintiffs say.
While it is difficult to assess the likelihood of success for these parties, they are probably not the last legal battles for Samsung regardless.