One of the best company in the world in terms of customer experience has recently found themselves in hot water. Apple Inc has agreed to pay a total sum of US$500 million to settle a lawsuit in The United States which claimed that the company deliberately slowed down the older iPhones to induce consumers in buying newer phones and batteries.
Apple consumers insisted that their phone performance suffered after they installed Apple software updates. They said this misled them into believing their phones were near the end of their life-cycles, requiring replacement or new batteries.
Apple denied any wrong doing but wants to settle the case in order to avoid the costs and burden of litigation.
As per the proposed settlement, Apple has to pay $25 per device to the owners of certain iPhone models, with a total minimum payout of $310 million. The amount each owner receive could increase or decrease depending on how many iPhones are eligible, according to the report.
The lawyers plan to seek up to US$93 million, equal to 30% of US$310 million, in legal fees, plus up to US$1.5 million for expenses.
The lawsuit settlement covers U.S. owners of the iPhone 6, 6 Plus, 6s, 6s Plus, 7, 7Plus, or SE that ran the iOS 10.2.1. It also covers U.S. owners of the iPhone 7 and 7 Plus that ran iOS 11.2 or later version, before 21st December, 2017.
In 2017, Apple did confirm that they slow down some iPhones, but said it only did so to ”prolong the life” of the devices.
Apple said the lithium -ion batteries in the devices became less capable of supplying peak current demands, as they aged over time.
That could result in an iPhone unexpectedly shutting down to protect its electronic components. As a result, it released a software update for their iPhone 6, 6s, and SE which ”smoothed out” battery performance, the company said.
Just last month, Apple was fined a total sum of 25 million euros by a French regulator for deliberately slowing down older iPhone models without notifying users.
The settlement of the lawsuit has somehow not put a damper on Apple financials as AAPL closed Monday regular trading bouncing back from the stock turmoil at $298.81 up $25.45 or 9.31%. In the after hours trade, the stock further gained $0.18 or 0.06%.
Following an initial outcry over slow iPhones, Apple apologized and lowered the price for replacement batteries to US$29 from US$79.