Notebook maker Quanta accuses AMD of hawking faulty chips

AMD has been sued by Quanta Computer, the world's largest contract laptop manufacturer, for allegedly selling defective chips. In its San Jose, Calif. federal court filing, Quanta claims that it purchased AMD chips that failed to meet certain heat tolerances, thereby making them unfit for use. The complaint specifically names the ATI RS600ME integrated graphics solution, which made its way into various low-end machines.

Unaware of the situation, Quanta used the chips in notebooks built for NEC and they reportedly caused the systems to malfunction. Because of that, the laptop maker claims to have suffered "significant injury to prospective revenue and profits." AMD is accused of negligent misrepresentation, civil fraud, breach of warranty and interference with a contract. Quanta seeks a jury trial and damages, though we haven't seen any figures.

We haven't found a list of affected machines or any consumer complaints, but NEC mainly sells devices in Japan and that could be why we haven't heard anything until now. It seems AMD hasn't either, as the company didn't hesitate to call shenanigans. "AMD disputes the allegations in Quanta's complaint and believes they are without merit," spokesman Michael Silverman told Bloomberg today.

"AMD is aware of no other customer reports of the alleged issues with the AMD chip that Quanta used, which AMD no longer sells. In fact, Quanta has itself acknowledged to AMD that it used the identical chip in large volumes in a different computer platform that it manufactured for NEC without such issues." It should be interesting to see if other notebook manufacturers step forward to back Quanta.