We can't say that we're shocked to hear this -- you know, considering just how long those Xbox Live holiday blues went on -- but Microsoft is indeed being slapped with a class action lawsuit over the aforementioned outages. Reportedly, a trio of angered Texans are alleging that Microsoft didn't abide by its own contract when network issues disallowed a good chunk of Live users from getting their fix over the past few weeks.

According to the complaint, MSFT understood that the time of year would lead to increased activity, yet "failed to provide adequate access and service to Xbox Live and its subscribers." Of course, we're betting the Redmond-based lawyers point out that clause about not guaranteeing any minimum level of service, but who knows, maybe we'll all end up with two shiny new Arcade titles.

Source- http://www.engadget.com/2008/01/05/microsofts-free-arcade-title-not-enough-still-hit-with-lawsuit/