My device was replaced once after detecting the screen scramble issue. But the replacement also developed the same problem after 4 months. Now I am also out of 3 years extended warranty and offered by microsoft to upgrade the 5th generation device at the cost of $ 599. But I have explored some forums and found that 5th generation device is also having the same issue.
Even similar issues have been reported in the Pro 7 model as well.
I don't think they have solution to this issue.
About the claim case, do let me know if you have approached consumer court and what is the response? You can mail me at [email protected]