Dell is facing a lawsuit from Andrew Cuomo, the New York Attorney General, on behalf of consumers in the state.
The computer maker, and its finance wing, are accused of fraud, false advertising, and failing to honour warranties and service contracts.
New York state is seeking an injunction against Dell to stop it continuing with its existing bad practises, and damages for customers who have suffered, according to the Wall Street Journal.
Dell said it would defend the case and is confident "that our practises will be found to be fair and appropriate".
The probe is separate to the Securities and Exchange Commission investigation into Dell's accounts.
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