While Apple (NASDAQ:AAPL) has denied allegations that the methods it used to approve or deny coverage under its warranty policy are flawed, the iPhone maker has agreed to pay $53 million to resolve a consumer class-action lawsuit.
Lawyers for the plaintiffs argued that the company relied on faulty indicators that showed iPhones and iPods were exposed to water to deny customers’ claims. Apple’s warranty policy does not replace devices that have been damaged by liquid spills or from submersion in a fluid, but the prosecution maintained that the liquid submersion indicators on iPhones and iPods could be triggered by moisture during ordinary use and falsely showed that devices had been damaged by liquid spills or submersion. Meanwhile, Apple said the indicators were reliable.
Consumers may be eligible for $300 depending on the device model they owned, according to documents filed in a federal court in San Francisco. Customers whose warranty claims for iPhones that were denied before December 31, 2009 and iPod Touches that were denied before June 2010 on the basis of Apple’s liquid damage policy are qualified for settlement funds. Attorneys can seek as much as 30 percent of the $53 million settlement fund for their fees and expenses.
While this case may seem a minor blip on Apple’s legislative logbook, it poses a notable contrast to the criticism the iPhone maker received from Chinese government propaganda regarding its warranty policy in that country. Under pressure, Chief Executive Officer Tim Cook apologized and amended the company’s warranty policy without any legal pressure.
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