I've had this problem too. What a disappointment! I returned mine and got another one.

It really helps if you put a damp paper towel or two over the grill just after turning it off, and then close the lid. Then clean off the gunk within an hour and it will be damp and soft and easy to remove. If you try to scrape off the residue that is hard, you will damage the teflon. They have newer models now with removable grids you can soak and wash. I've had mine for years and it's still fine.

Funny you should mention the paper towel trick because that is exactly what I did with my last grill. We thought that perhaps the teflon coating wasn't sealed properly and the dampness from the paper towel got underneath it and made it bubble.

I think I may give it one more try with the removeable grid model. If that doesn't work, then we'll never buy another one again.

The removeable grills are great -- Hamilton Beach makes a cheaper model with removeable plates which I got before Foreman introduced removeable plates -- couldn't stand cleaning the old style Foreman - who the heck cleans pans with paper towels and no soap -- yuck.

There is also a very nice Cusinart model that also converts to a panini maker and grill.