5 examples of how better customer service might have prevented a lawsuit:

by Pam Clark

The business benefits of having good customer service are well documented, even if difficult to measure. But perhaps more important, is the potential downsides of having poor customer service. With the evolution of the internet, negative publicity spreads like never before. It's no wonder that reputation management is a booming industry for online marketers.


For most businesses, reputation management simply means staying off sites like these, or (perhaps) keeping negative reviews off of Yelp. But the absolute worst case nightmare scenario for a business is to have their poor service give a customer cause to take legal action. Because even if the company wins, they lose.


The following 5 stories are examples of how a company's limitations or carelessness in the area of customer service is in large part to blame for being sued:

Man sues Hilton Hotels for being charged $.75 for USA Today

At first I thought this story was an Onion article. I laughed at the title only to later find out that the story is actually true. In fact, it's the inspiration for this article.


Rodney Harmon, of Sacramento County was staying at the Hilton Garden Inn of the Sonoma County Airport when, in the morning, he found a USA Today at his doorstep. Not interested, he ignored the paper only to later find out he would be charged for it anyways because he did not specifically opt out from receiving the paper. So he's suing them.


Whether or not you feel Mr. Harmon is entitled to or will receive any compensation for this situation is irrelevant. The fact is, the act of filing a suit will bring into light a very fundamental customer service flaw. Deceitful practices such as opting customers in to additional services without their explicit knowledge is just bad business. It makes customers feel nickle and dimed, and question their trust in a brand's core services. I doubt this lawsuit will go very far, but it might convince a few people to seek other accommodations.

Dell sued for bad customer service

2007 was a bad year for Dell. And most of it can be rooted to their “Award winning sales and support”. In fact, it's that claim that got them into the most trouble.


In May of 2007, the then NYS Attorney General sued Dell accusing the company of accusing the company of deceptive, fraudulent, and illegal business practices. Part of the lawsuit was related to their marketing claim of “Award winning support” and failure to deliver on the promise. Dell customers were among the most common complaints to the AG's office that year, and stories of “Dell Hell” from customers who purchased expensive support services were so common that something was finally done about it.


What quickly followed was Dell's good reputation and reigning position as #2 computer seller in the U.S. quickly turned into a company on the slide. Sales declined and the years to come were hard work recovering from their own reputation problem. Today, sales are improving, but in the meantime Dell learned their lesson in customer service the hard way.

Air Canada ordered to pay $12,000 to customer who was refused service in French

This can only happen in Canada… no really. Canada has laws that give both English and French equal status which compels federal institutions to offer services in both. Air Canada, a privatized, once Crown corporation, retained its language obligations when it went private. So when Michel Thibodeau, a fluently bilingual Ottawa citizen couldn't order a 7-up in his language of choice, he decided to sue.


This might seem like a matter of [ahem] French arrogance, and perhaps that's partially true, but the truth is: it's a fatal mistake for the airline regardless of the law. Despite the fact that Mr Thibodeau was fluent in English too, some french Canadians are not. Failure to cater to these individuals will cause them to seek alternative means of travel. Not only that, but those who are fluent in both, but take pride in their French roots, will also be turned off by this failure. My point is this: the situation could have been avoided. Not every flight attendant must speak French, but there probably should be at least one on each Air Canada flight. Then a simple sentence would suffice: “My apologies sir, I do not speak french, but the other flight attendant does, so I'll have her/him come take your order right away.” Would that have been so hard?

Urban Active sued by customers for failure to fix billing issues

Here's a situation where poor customer service wasn't the root cause, but failure to have adequate service was the last straw.


A customer of an Ohio fitness club chain Urban Active recently filed a class action suit for failing to resolve billing disputes. Terry Troutman alleges that the company was billing him for late fees even though his monthly dues were automatically billed to his credit card. And he's not alone. Mr. Troutman's attorney told the press that the fitness center resolved a single claim with a refund, but has failed to remedy the final two. Coby DeVary, CEO of Urban Active all but admits that they could not timely handle all of the claims and states that "We've realigned personnel, added staff in our corporate headquarters … to meet and exceed our customers' expectations,"


A simple billing glitch was likely the root cause of the problem, but instead of dealing with it head on, Urban Active chose to be more passive about resolving it. Consider this a lesson learned.

Apple support company sues customer for complaining

Here's a different take on ways to deal with customer complaints. Sue them.


Dimitris Papadimitriadis, a physician in Greece was having trouble with his iMac and decided to bring it in to Systemgraph, a support company officially approved by Apple to be its authorized service provider. When he got the computer back, however, it was in even worse condition. He asked Systemgraph for a refund for the computer, to which he was denied because he hadn't bought it there. Annoyed, Mr. Papadimitriadis posted his story on a forum looking for help on what to do next. Systemgraph, then filed a suit against him claiming he is damaging their reputation. In fitting irony, when this story broke in January of this year, it was more damaging than the original post could ever have been. I really don't know what they were thinking…


Share This...

Previous post:

Next post: