According to Information Week, Microsoft and Bungie are being sued over Halo 3. Randy Nunez of San Diego alleges in his suit that the companies released a faulty product that causes his Xbox 360 to malfunction. His legal papers state that Halo 3 "consistently causes the Xbox 360 to crash, freeze, or lock up while the game is being played." Nunez charges that Microsoft and Bungie are violating consumer protection laws and he's seeking class-action status for the suit along with $5 million in damages.

"Although faced with repeated and mounting consumer complaints and inquiries concerning this operational flaw in Halo 3, the defendants have failed to recall Halo 3 or otherwise remedy its failure to function on the Xbox 360," the suit alleges.

The first serious controversy for Halo 3 came when many "limited edition" versions of the game came with scratched discs, though Microsoft quickly responded by offering free replacements. It is unknown if the issues cited by Nunez above relate to the general Xbox 360 hardware failures that have been widely reported since the system's inception and caused Microsoft to extend its original warranty agreement for the system.