Jul 12, 2016 | By Alec
There’s finally some good news for MakerBot. The class-action lawsuit that was brought against MakerBot about a year ago has been dismissed by a Minnesota court. The Stratasys-owned MakerBot was accused of fraudulently misleading investors and customers after serious glitches in the MakerBot’s 5th Generation Replicator 3D printer became apparent, but this lawsuit was dismissed due to a lack of strong evidence. The judges were still critical of MakerBot, saying that the executives were behaving badly – though there wasn’t strong enough evidence to suggest serious fraudulent behavior.
Thus another chapter in MakerBot’s history ends inconclusively. As 3D printing veterans doubtlessly know, MakerBot is becoming increasingly controversial in the community. Though once the most promising name in 3D printing, their sales figures failed to meet the company’s ambitions in recent years. This led to serious cutbacks in April 2015, when several retail locations were shut down and a fifth of the staff was laid off. The company was trying to lay low and reorganize its finances in the months that followed; among others, incoming CEO Jonathan Jaglom was forced to fire more staff and outsource production a few months ago.
But before they could repair the company’s reputation (and their stock value), the faulty 5th generation Replicator caught up with them last summer. The 3D printer was glitchy, to put it mildly, and quickly became known for its poor printing quality and recurring problems. In particular, the machine’s Smart Extruder – promoted as a novel way to re-load filament – proved to be poorly designed and prone to clogging. Some users were even reportedly forced to replace their machine several times within a single six-month warranty period.
This led to the lawsuit, which argued that the problems could be traced back to poor quality control, an overly-aggressive growth strategy, and the company’s inability to own up to their mistakes. “Defendants rushed MakerBot’s 5th generation printers to the market despite their knowledge of serious quality and reliability issues plaguing the printers,” the lawsuit stated. “Because the new MakerBot printers were so poorly designed and manufactured, significant number of purchasers demanded refunds, repairs, replacement printers or [parts], which were costly to MakerBot given that the 5th generation printers were under warranty. The replacements were equally flawed and prone to failure.”
In particular, investors and customers were angry over the company’s promises. The MakerBot leadership repeatedly described their 3D printers as being of a good quality, even though the flaws must have been known within the company. The critical judges dismissed the leadership’s statements as ‘non-actionable puffery’, the kind of positive business remarks that accompany every release by every company.
What’s more, the court found no evidence of a purposeful fraud in regards to the malfunctions. While some internal discussions about the problems were found within the MakerBot company, they never led to the pinpointing of the root of the problems. While the judges did criticize the MakerBot leadership, there simply enough evidence to suggest that any serious wrongdoing had taken place.
While MakerBot will probably take this as a win, it’s still a situation that no one will be truly happy with. MakerBot reputation remains tarnished, as the court effectively revealed that there was mismanagement, but the company has not been put out of its misery either. Combine that with the 36 percent of its initial workforce that has been fired over the last 16 months and the serious product flaws, it becomes clear that MakerBot will have to work very hard to get back on top.
Posted in 3D Printer Company
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the same way Solidoodle tried & failed
I.AM.Magic wrote at 7/12/2016 4:33:08 PM:
I haven't come across a single working 5th generation makerbot... 4th are running with a lot of maintenance. How can you get away with selling a non-working machine? It is just a big paper weight.
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