A class action suit has reportedly been filed against Microsoft's Xbox 360 console, alleging it scratches game discs.

The suit claims that thousands of users have experienced the disc scratch problem, and have registered complaints about the same with Microsoft.

Interestingly, the report comes within days of the software giant spending nearly $1 billion towards fixing hardware problems in it's Xbox 360 consoles.

What's more, the problem is not limited to the US alone. The suit details a television program that was aired in the Netherlands that addresses user complaints besides talking about laboratory results going to prove that Xbox 360 consoles actually scratch discs, making them unusable.

The suit, which has been filed in the US District court for the Southern District of Florida, demands over $5 million in damages and compensation.

Meanwhile, Microsoft denies having received any such reports of disc scratching. However, the company has assured it will examine the consoles, and if found faulty, repair them.

As it is, Microsoft has a worldwide disc replacement program under which an Xbox 360 user can send damaged discs to the company along with $20 and get replacements for them.