Dell has withdrawn its attempt to prove that discount reseller, Computer Disposals, does not have the finances to continue legal action in the NSW Supreme Court against the vendor.
According to Computer Disposals managing director, Tom O’Donnell, Dell had been attempting to prove to the Supreme Court that the reseller was insolvent. Proving it would have indicated to the court that the reseller would not be able to pay for Dell’s legal expenses should its legal action against the vendor prove unsuccessful.
The matter between Dell and its former reseller relates to cancelled orders of Dell computer hardware that Computer Disposals resold online, both at a cheaper price and with warranty included, to the retail channel.
Computer Disposals claims it paid for three-year warranties on some of these products which were not honoured by Dell.
O’Donnell alleges that Dell gave the products a one-year warranty and charged Computer Disposals for three years, adding up to $334,337 in over-charged invoices.
Dell refutes this and claims that Computer Disposals has not been billed for the invoices, O’Donnell said. The vendor is in the process of counteracting the original action.
O’Donnell said that Dell’s application to prove Computer Disposals insolvent was essentially an attempt to force the company to retreat, because Dell’s legal costs had reached about $165,000.
“We presented to the court all the financial information required to prove that we are solvent and then Dell withdrew the claim,” he said. “Dell is putting up delay tactics — we are just trying to get the original case in front of the court.”
O’Donnell said that his company would succeed in the action.
“Dell is pushing this because it doesn’t want to lose face in terms of honouring warranties,” he said. “It is maintaining that the warranties were never promised, but I have the evidence in black and white.”
While Dell purports to be purely a direct seller of PC and server hardware, the vendor has signed up resellers in the past to more surplus, discontinued and second-hand equipment into the market at lower prices.
Dell spokesperson, Nicole Gemmell, would not comment on any of the issues.
She said Dell’s position was not to comment because the case was before the court.