What we heard: When Microsoft released the Fall Update for the Xbox 360 on October 31, reports that it was "bricking" some systems--rendering them unable to play games or even boot up properly--quickly flared up online. Web sites specializing in the Xbox modding scene speculated that the bricked systems were an intentional byproduct of the update. According to them, Microsoft wanted to break consoles that had been tampered with to do things for which it wasn't intended, like play pirated copies of games. Microsoft required that anyone wishing to take their Xbox 360 console onto the Xbox Live service download the update.
While initially quiet on the subject, Microsoft the next day acknowledged problems that affected "less than 1 percent" of Xbox 360 owners who installed the update onto their consoles. The company said it was working with those affected to resolve the issue, and released an updated version of the Fall Update.
That apparently didn't satisfy everyone, as earlier this week, a poster on the official Xbox.com message boards waded into the middle of a 60+-page thread about the Fall Update problems and claimed that he had filed a class-action lawsuit against Microsoft in the matter.
A handful of gaming Web sites picked up on the news and passed it along, each of them noting that it was an unconfirmed report from a message board poster.
As it turns out, the poster was telling the truth. GameSpot obtained a copy of the original complaint, which was filed in a Washington district court. The suit accuses Microsoft of breach of contract, negligence, and violation of the state of Washington's Consumer Protection Act (CPA). Stating that the affected consumers number in "at least the thousands," the suit contends that Microsoft is refusing to repair or replace the broken systems unless the users pay "up to $140" to ship it back to the company.
The plaintiff is demanding that Microsoft pay at least $5 million in damages for breach of contract to those affected by the Fall Update problems, and an additional amount of at least $5 million in damages for an unfair or deceptive act under the CPA. Should Microsoft argue that it had no agreement to breach with the affected users, then the plaintiff contends Microsoft was negligent, and should be made to pay at least $5 million in damages.
[UPDATE] The official story: A Microsoft representative issued the following response to the matter:
"A small percentage of consoles (less than 1 percent) were affected by the Fall Update. An updated version of the Fall Update was made available on Xbox Live on November 1 which eliminated issues relating to new or refurbished consoles malfunctioning after applying the Fall Update.
"Users affected by the initial Fall Update would have seen an error message and should call Xbox Support (1-800-4-MY-XBOX in the US and Canada). Microsoft is making every effort to resolve this issue for its customers as fast and easy as possible. It's also important to note that Xbox Support is paying for the shipping and repair/replacement of all Xbox 360 consoles that malfunctioned as a result of the Fall Update on October 31, before it could be fixed on November 1. They just need to phone Xbox Support and give them the proper error message indicating it was the Fall Update that affected their console."
Bogus or not bogus?: Fortunately for those reporting without a net, not bogus.