When Microsoft released the Fall Dashboard Update in 2006 for the Xbox 360, users expected new features. What no one expected was that the update crashed consoles, rendering them mostly useless. Microsoft quickly acknowledged and fixed the problem, and advised those who had bricked consoles to contact Xbox tech support for further instruction.

More than a month after Microsoft’s dangerous Dashboard, Californian man Kevin Ray filed a class action lawsuit against Microsoft seeking $5 million in damages in addition to free repairs after his own Xbox 360 was disabled by the update.

According to Todd Bishop’s Microsoft Blog, Microsoft and Kevin Ray have settled the case under confidential terms. The case was settled as in individual action, rather than a class action.

The settlement of the lawsuit is likely affected by Microsoft’s several revisions to its Xbox 360 warranty. In December 2006, Microsoft extended its general console warranty to one year – up from its previous 90-day coverage. In April 2007, the company decided to bulk up its warranty services by offering free shipping for consoles in and out of warranty.

The latest warranty upgrade came in July 2007, when Microsoft said that it would cover all Xbox 360 for three years from any “Red Ring of Death” defects. The new warranty policy announcement came shortly after DailyTech’s discovery that up to one-third of all Xbox 360 consoles fail within their first year of use.

Following Microsoft’s first revision to its warranty, the company’s customer service records show that the plaintiff’s, Kevin Ray, Xbox 360 console was shipped and repaired without charge.

“Microsoft did not charge Mr. Ray any money for replacing or shipping his Xbox 360 console,” read the company documents. “He has not contacted Microsoft with any further complaint.”