SETTLEMENT REACHED WITH APPLE OVER WARRANTY DISPUTE

April 17th, 2013

Apple’s stock may be taking a beating as the market becomes more volatile. Moreover, analysts are looking for the next big offering from the tech giant. But in the meantime, Apple is fending off class action lawsuits based on disputes over warranties applying to damaged iPod Touch and iPhone devices.

The case, In re Apple iPhone/iPod Warranty Litigation, involved a number of class actions brought to seek remedies when the company denied coverage under its liquid damage policy. Essentially, the devices had a Liquid Contact Indicator that would inform consumers of damage caused by water contact. (The indicator would turn pink or red, suggesting that the phone had come in contact with water).

However, Apple would (in many instances) refuse to honor the warranty, despite consumer complaints that their phones had never been compromised by water.

It was later found that humidity (and not water) would cause the indicator to react.

As such, Apple has reached a settlement with class members and will pay $53 million to resolve the claims. They include iPod Touch owners who tried to replace (or repair) their phones before June 30, 2010 and iPhone owners who tried to do the same before December 31, 2009. Through the settlement, class members will be eligible to receive up to $300 if they owned an iPhone, and as much as $265 if they had an iPod Touch.

The agreement is subject to court approval, but there are no indications that it will be rejected. The case is yet another example of the need for consumers to join together when corporations put profits ahead of customer satisfaction.

Source: TopClassActions.com, Apple reaches $53 million iPhone/iPod warranty class action settlement, April 15, 2013

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