Dell Optional Service Contract, Rhode Island Tax Class Action Settlement

A settlement has been reached between Dell, the Rhode Island Department of Revenue (DOR) and a group of Rhode Island consumers who purchased an Optional Service Contract from Dell and were charged state sales or use tax.

Lead plaintiff Julianne Ricci filed the class action action lawsuit against Dell in May 2003, claiming the company violated Rhode Island law by improperly charging and collecting state sales and use tax on consumer purchases of Optional Service Contracts.

The Optional Service Contracts at issue here provided for repair and/or replacement services, including parts and/or labor, covering computer hardware sold by Dell companies or agents, the purchase of which was not required for the purchase of the computer hardware the service contract covered.

Among the Optional Service Contracts included in this settlement are technical support service contracts, on-site repair service contracts, remote repair service contracts, and “CompleteCare” contracts.

Dell argued that they acted reasonably in collecting taxes on the Optional Service Contracts as they believed was required by law, and that they did not violate Rhode Island law.

In response to the class action lawsuit, Dell filed tax refund claims with the DOR for a refund of monies remitted to the state as tax on these Optional Service Contract purchases.

Under the terms of the proposed settlement, Dell agreed to pay compensation (without interest) to Class Members for purchases not covered by Dell’s tax refund claims.

For purchase covered by defendants’ tax refund claims, DOR will provide compensation, with interest, to settlement Class Members who submit timely and valid claims.

However, if the sum of all DOR Claims, including interest, exceeds $700,000 the payment on each such DOR Claim will be prorated accordingly.

The proposed settlement distinguishes between Dell Claims and DOR Claims because those two types of claims cover different time periods and the payments for those claims are funded by different entities.

Dell Claims concern transactions made between May 16, 1993 and Sept. 30, 2001, and Dell will fund the payments for those claims.

DOR Claims concern transactions made between Oct. 1, 2001 and Dec. 31, 2011, and DOR will fund the payments for those claims.

Settlement Class Members may be entitled to compensation from one or both of Dell and DOR, and may need to submit several claims.

Dell agreed to the settlement to resolve the case and get compensation to the affected purchasers.

Class Members who wish to object to the terms of the settlement or wish to be excluded from the settlement must do so by Nov. 9, 2016.

Who’s Eligible

You are eligible to be a member of the settlement Class if you meet all of the following:

1. You purchased an Optional Service Contract from Dell at any time from May 16, 1993 through Dec. 31, 2011.
2. Your “ship to” address for the purchase was a location in the state of Rhode Island.
3. You paid any amount of money denominated as a “tax” calculated in whole or in part on the charge for the purchase of such optional service contract.
4. You did not receive from any of the defendants a refund of such “tax” in connection with a return of the computer hardware or otherwise.

Potential Award

Varies.

For each individual consumer identified by a Dell customer number, an individual settlement amount will be calculated since the tax payment made by consumers varied, depending on the price and number of Optional Service Contracts purchased.

The tax payment for any single Optional Service Contract was between approximately $2 and $30; but for consumers who purchased many Optional Service Contracts, the tax payments may be much more.

For Dell Claims, which concern transactions made between May 16, 1993 and Sept. 30, 2001, Dell will pay the individual settlement amount to the settlement Class Member without interest.

For DOR Claims, which concern transactions made between Oct. 1, 2001 and Dec. 31, 2011, DOR will pay the individual settlement amount plus interest to the settlement Class Member.

If the sum of all individual settlement amounts (including interest) payable as timely and valid DOR Claims exceeds $700,000 the payment on each such DOR Claim will be prorated accordingly.

Settlement Class Members may be entitled to compensation from one or both of Dell and DOR Claims, and may need to submit several claims.

Note: Offsets for debts by the state of Rhode Island. DOR will offset against any refund to which a settlement Class Member would otherwise be entitled any amounts that DOR has the right to offset under Rhode Island laws, except DOR will not offset any amount of unpaid use tax on a settlement Class Member’s purchase of Dell hardware. Such offset may reduce or completely consume the amount to be received by the settlement Class Member.

Proof of Purchase

Eligible Class Members will be required to provide the Dell Claim Number or DOR Claim Number, password, and other information from their mailed Short Form Notice and Individual Summary.

If you did not receive a Short Form Notice and Individual Summary and believe that you purchased Optional Service Contracts from Dell and paid tax thereon between May 16, 1993, and Dec. 31, 2011, please email the Claims Assistance Email Inbox at info@RhodeIslandTaxSettlement.com.

Claim Form

CLICK HERE TO FILE A CLAIM »

Claim Form Deadline

01/19/2017

Case Name

Long, et al. v. Dell Inc., et al, Case No. PC 03-2636, in the Rhode Island Superior Court, Providence County

Final Hearing

12/09/2016

Settlement Website

www.RhodeIslandTaxSettlement.com

Claims Administrator

Long v. Dell Litigation
Settlement Administrator
c/o Epiq Class Action & Claims Solutions Inc.
PO Box 3145
Portland, OR 97208-3145

Email: info@RhodeIslandTaxSettlement.com

Class Counsel

Fredric L. Ellis
Edward D. Rapacki
Joseph M. Makalusky
ELLIS & RAPACKI LLP

Matthew T. Oliverio
OLIVERIO & MARCACCIO LLP

Defense Counsel

John A. Shope
FOLEY HOAG LLP
Attorney for Defendant Dell

Bernard Lemos
RHODE ISLAND DEPARTMENT OF REVENUE
Attorney for Defendant DOR