NY judge: Dell engaged in fraud, false advertising

SEATTLE Tue May 27, 2008 11:08pm BST

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SEATTLE (Reuters) - A New York judge ruled against Dell Inc DELL.O on Tuesday, saying the computer maker engaged in fraud, false advertising, deceptive business and abusive debt collection practices.

New York State Supreme Court Judge Joseph Teresi said Dell lured customers with advertisements offering "no interest" or "no payment" financing options, but its financing arm would charge higher rates.

New York State Attorney General Andrew Cuomo, whose office filed a lawsuit against Dell in May 2007, said the court will hold further proceedings to determine how much Dell will have to pay its customers in restitution.

Shares of Dell closed up 30 cents, or 1.42 percent, at $21.49 on Nasdaq.

Dell said it disagreed with the ruling, but has not decided whether to appeal.

"We don't agree with this decision and will be defending our position vigorously. Our goal has been, and continues to be, to provide the best customer experience possible," the company said in a statement.

"We are confident that when the proceedings are finally completed the court will determine that only a relatively small number of customers have been affected," it said.

Cuomo's office had sought an injunction against Dell's practices, and unspecified damages to affected customers.

(Reporting by Daisuke Wakabayashi; additional reporting by Sue Zeidler; editing by Jeffrey Benkoe)

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