Toshiba Reaches Settlement of U.S. Lawsuit Regarding Floppy Disk Controllers In Notebook PCs

TOKYO (PROTEXT) - Toshiba Corporation has reached a settlementin a class-action lawsuit in the U.S. concerning the floppy-diskdrive controller incorporated in its notebook PCs (hereafterabbreviated as PCs). The settlement received preliminary approvalfrom the Federal Court in Texas, where the suit was filed, andwill be formally in effect following final approval to be givenby the court. The suit was brought earlier this year by two U.S. owners ofToshiba's PCs. They alleged that a condition in the microcode forthe floppy disk controller (FDC) in Toshiba PCs may, undercertain circumstances, cause data to be lost or corrupted as itis written to a floppy disk. They requested compensation undervarious theories of liability, including breach of warranty. Toshiba has been vigorously defending itself in the lawsuit byarguing that it is not aware that the operating restriction onits FDC has ever resulted in the alleged data loss or datacorruption. Toshiba decided to settle the case for the following reasons: 1) Based on the legal precedents in the U.S., there was aserious risk that a substantial amount of compensation could beawarded through a jury verdict in the class-action lawsuit. 2) Toshiba wants to continue to ensure its customers that theToshiba brand name merits their trust. Toshiba carefully considered the risks attendant on continuingthe case, and reached a settlement. The company has done sowithout admitting liability or that its PCs have technicalproblems or defects. The settlement detailed below applies only in the U.S. 1) From November 8, Toshiba will incorporate a new FDC in PCsmanufactured for sale in the U. S. 2) Toshiba will provide eligible customers with a softwarepatch or a hardware solution, depending on when PCs werepurchased. 3) Toshiba will provide coupons bearing a value of $100 toowners whose PCs were out of warranty as of March 5, 1999. Ownerswhose PCs were under warranty as of that date will receive acoupon with a value of $225 or $200, determined on the basis oftheir choice of the software patch or hardware solution,respectively. The coupons can be used for the purchase of Toshibacomputer products sold through Toshiba's U.S. subsidiary. 4) Cash refunds will also be available for more recentpurchasers. In regions and territories other than the U.S., Toshiba willalso ship PCs incorporating the modifications after November andwill also make the free software patch available for currentusers. Toshiba Corporation will reflect a 110 billion yen(approximately US$1 billion) extraordinary loss in its financialresults for fiscal year 1999 in connection with the settlement.ots Original Text Service: Toshiba Corporation Internet:http://www.newsaktuell.de Contact: Keisuke Ohmori of ToshibaCorporation, +81-3-3457-2105, or keisuke.oomori@toshiba.co.jpWeb site: http://www.toshiba.co.jp

Subscribers please note that material bearing the slug"PROTEXT" is not part of CTK's news service and is not to bepublished under the "CTK" slug. Protext is a commercial serviceproviding distribution of press releases from clients, who areidentified in the text of Protext reports and who bear fullresponsibility for their contents.

PROTEXT