Microsoft must face class action claims over alleged Xbox defect

People walk past an Xbox sign at the 2014 Electronic Entertainment Expo, in California June 10, 2014.

Credit: /Jonathan Alcorn

- A federal appeals court on Wednesday revived class-action allegations in which owners of Microsoft Corp Xbox 360 video game consoles sued the company over an alleged design defect that causes game discs to be gouged.

The 9th U.S. Circuit Court of Appeals said a lower court judge misapplied the law in striking the classwide allegations, and that this error was an abuse of discretion. It did not address whether the Xbox owners deserved to have their claims treated as a group.