Not going to speculate on the problem, but there clearly is a unique issue here. I've had the 700s for a couple of months now, and I may actually have begun to prefer them to my SE530s and Image X10s. And believe me, I know how to CRANK them UP, and no hint of distortion. The falling out issue is separate problem, I've found the Shure tri-flanges work great and sound better than anything else (gets rid of some sibilance the phones used to have).