$4M Settlement to Resolve Staples Computer Service Plan Class Action

A dispute over the terms of a Staples computer service plan has ended in a class action settlement that is now waiting on preliminary court approval.

The parties submitted the Staples class action settlement to the court last Friday for preliminary court approval. If approved, the settlement will provide reimbursements to Staples customers who purchased an Extended Services Plan in conjunction with their purchase of office equipment from Staples.

Plaintiff Andrew Orlander initiated this Staples class action lawsuit in January 2013. He alleged that when he bought a computer from Staples in March 2012, he also paid $99.99 for an Extended Services Plan. With that plan, he understood that he could bring the computer to a Staples store for any necessary repairs, instead of having to contact the manufacturer.

Staples offered Orlander and other plan purchasers only a three-page brochure that summarized the terms of the plan, he claimed. Written statements in that brochure and verbal statements from store representatives led Orlander to believe that the Staples computer service plan provided full coverage during its two- to three-year term.

Orlander said he was unpleasantly surprised to find out his Staples computer service plan did not provide any services during the first year of its multi-year term. A few months after his purchase, he sought service from Staples for a problem with the computer’s wifi, only to be told the plan does not kick in until after the computer’s warranty expires, he claimed.

His claim was dismissed in June 2014 when a trial court judge determined the Staples computer service plan unambiguously excluded coverage for problems already covered by the manufacturer’s warranty. The claim was revived on appeal, however, after the Second Circuit determined that language in the plan’s brochure was subject to multiple interpretations.

After conducting discovery, the parties began settlement discussions in summer 2016, then enlisted the help of a mediator that December. They agreed in principle to the current Staples class action settlement in February 2017.

Under terms of the settlement, Staples will create a settlement fund worth $3.95 million. This fund will cover payments to Class Members, an incentive award for Orlander up to $5,000, costs of administering the settlement, and class counsel’s attorney fees and court costs.

Payments to Class Members will be distributed on a pro rata basis, with a maximum payment of 100 percent of the Extended Services Plan’s purchase price. Class counsel estimates that full participation will result in individual payments worth about 11 percent of the purchase price of the Staples service plan.

The settlement administrator will automatically send payments to known Class Members, according to class counsel.

Top Class Actions will post updates to this class action settlement as they become available. For the latest updates, keep checking TopClassActions.com or sign up for our free newsletter. You can also receive notifications when this article is updated by using your free Top Class Actions account and clicking the “Follow Article” button at the top of the post.

Proposed Class Members to benefit from this settlement include all persons who purchased an Extended Services Plan from Staples in New York State between Feb. 1, 2010 and Aug. 31, 2013.

Orlander and the settlement Class are represented by attorneys Meagan A. Farmer and Jennifer Sarnelli of Gardy & Notis LLP.

The Staples Computer Service Plan Class Action Lawsuit is Orlander v. Staples Inc., Case No. 1:13-cv-00703, in the U.S. District Court for the Southern District of New York.

UPDATE: October 2017, the New York Staples service plan class action settlement is now open. Click here to file a claim.