People have talked about broken rotary encoders on the POD HD500. The POD footswitch is incredibly robust overall, except for this one part. See prior discussion on the old Live 6 forum site here:
http://line6.com/supportarchivenew/thread/81855
If you're careful, you can reassemble the part as described there and bend back the tiny little tabs. Better yet though, you can buy the replacement part for $9. In either case, I'd suggest adding a spacer behind the case to hold the whole thing together as describer in that first post by Hummelong. Part available here:
http://haightashburymusic.com/accessories/parts-components/pots/line-6-rotary-encoder-20-step-with-switch-dshaft-me-for-the-line-6-pod-hd500-podx3.html.
Be patient disassembling the POD and unsoldering the old part; but it's totally doable in an hour if you have basic screwdriver and soldering skills, plus a T-8 driver.