RIM Faces Lawsuits Over BlackBerry Outages
Already reeling from the bad PR, the smartphone maker now has a pair of class action suits to worry about.
| Posted Thursday, Oct. 27, 2011, at 11:57 AM
Research in Motion’s recent BlackBerry service failure has plenty of people speculating about whether the smartphone maker will be able to survive, but the company is now facing a more immediate problem: It’s being sued over the outages.
Reuters reports that the company now faces class action lawsuits in both Canada, it’s home country, and the United States over the network failure that frustrated customers on five continents. The suits allege that Research in Motion violated its contract with clients by failing to compensate them adequately for the disruptions.
Informa Telecom & Media estimated that RIM could face up to $25 million in payouts over the outages, according to the BBC. While that total may not break the bank for the tech company, the suits and accompanying press coverage likely won’t help the company as it tries to turn the page and regain its footing in an increasingly competitive – and Apple-dominated – smartphone market.
"If I was RIM, I would just compensate users quickly," said Malik Saadi, an analyst with Informa. The $25 million, he said, "is not big money compared to revenues. The biggest damage is to its brand, and that could take years to cure."
