Dead pixels have been reported by many Nintendo Switch owners and while they might be annoying, Nintendo doesn't actually consider them a problem. In a post on its UK website, the company says "Small numbers of stuck or dead pixels are a characteristic of LCD screens. These are normal and should not be considered a defect."
It's possible Nintendo will consider screens filled with dead pixels to be defective, but not all seemingly problematic displays will be treated in that way. However, that doesn't necessarily mean returns and replacements aren't possible.
A similar issue appeared in 2004 with the Nintendo DS, which led to Nintendo eventually changing its position to fix the units.
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