Apple faces lawsuits after saying it slows down aging iPhones
UNTV News • December 27, 2017 • 3952
FILE PHOTO – A salesman checks a customer’s iPhone at a mobile phone store in New Delhi, India, July 27, 2016. REUTERS/Adnan Abidi/File photo
SAN FRANCISCO (Reuters) – Apple Inc (AAPL.O) defrauded iPhone users by slowing devices without warning to compensate for poor battery performance, according to eight lawsuits filed in various federal courts in the week since the company opened up about the year-old software change.
The tweak may have led iPhone owners to misguided attempts to resolve issues over the last year, the lawsuits contend.
All the lawsuits – filed in U.S. District Courts in California, New York and Illinois – seek class-action to represent potentially millions of iPhone owners nationwide.
A similar case was lodged in an Israeli court on Monday, the newspaper Haaretz reported.
Apple did not respond to an email seeking comment on the filings.
The company acknowledged last week for the first time in detail that operating system updates released since “last year” for the iPhone 6, iPhone 6s, iPhone SE and iPhone 7 included a feature “to smooth out” power supply from batteries that are cold, old or low on charge.
Phones without the adjustment would shut down abruptly because of a precaution designed to prevent components from getting fried, Apple said.
The disclosure followed a Dec. 18 analysis by Primate Labs, which develops an iPhone performance measuring app, that identified blips in processing speed and concluded that a software change had to be behind them.
One of the lawsuits, filed Thursday in San Francisco, said that “the batteries’ inability to handle the demand created by processor speeds” without the software patch was a defect.
“Rather than curing the battery defect by providing a free battery replacement for all affected iPhones, Apple sought to mask the battery defect,” according to the complaint.
The plaintiff in that case is represented by attorney Jeffrey Fazio, who represented plaintiffs in a $53-million settlement with Apple in 2013 over its handling of iPhone warranty claims.
The problem now seen is that users over the last year could have blamed an aging computer processor for app crashes and sluggish performance – and chose to buy a new phone – when the true cause may have been a weak battery that could have been replaced for a fraction of the cost, some of the lawsuits state.
“If it turns out that consumers would have replaced their battery instead of buying new iPhones had they known the true nature of Apple’s upgrades, you might start to have a better case for some sort of misrepresentation or fraud,” said Rory Van Loo, a Boston University professor specializing in consumer technology law.
But Chris Hoofnagle, faculty director for the Berkeley Center for Law & Technology, said in an email that Apple may not have done wrong.
“We still haven’t come to consumer protection norms” around aging products, Hoofnagle said. Pointing to a device with a security flaw as an example, he said, “the ethical approach could include degrading or even disabling functionality.”
The lawsuits seek unspecified damages in addition to, in some cases, reimbursement. A couple of the complaints seek court orders barring Apple from throttling iPhone computer speeds or requiring notification in future instances.
The U.S. Justice Department said on Tuesday (July 23) it was opening a broad investigation of major digital technology firms into whether they engage in anti-competitive practices, the strongest sign the Trump administration is stepping up its scrutiny of Big Tech.
The review will look into “whether and how market-leading online platforms have achieved market power and are engaging in practices that have reduced competition, stifled innovation, or otherwise harmed consumers,” the Justice Department said in a statement.
The Justice Department did not identify specific companies but said the review would consider concerns raised about “search, social media, and some retail services online” — an apparent reference to Alphabet Inc, Amazon.com Inc., and Facebook Inc., and potentially, Apple Inc.
A Justice Department spokesman declined to provide a list of companies that would be scrutinized.
Google and Apple declined to comment, referring to prior statements by executives, while Facebook and Amazon did not immediately comment.
Facebook fell 1.7% in after-hours trading, while Alphabet fell 1%, Amazon was down 1.2% and Apple was 0.4% lower.
The announcement comes a day before the Federal Trade Commission is set to announce a $5 billion penalty to Facebook for failing to properly protect user privacy.
Senator Richard Blumenthal, a Democrat, said the Justice Department “must now be bold and fearless in stopping Big Tech’s misuse of its monopolistic power. Too long absent and apathetic, enforcers now must prevent privacy abuse, anti-competitive tactics, innovation roadblocks, and other hallmarks of excessive market power.”
In June, Reuters reported the Trump administration was gearing up to investigate whether Amazon, Apple, Facebook and Alphabet’s Google misuse their massive market power, setting up what could be an unprecedented, wide-ranging probe of some of the world’s largest companies.
A person briefed on the matter said the Justice review may also include some state attorneys general.
The Justice Department said the review “is to assess the competitive conditions in the online marketplace in an objective and fair-minded manner and to ensure Americans have access to free markets in which companies compete on the merits to provide services that users want.”
Reuters reported on May 31 that the Justice Department was preparing an investigation of Google to determine whether the tech giant broke antitrust law.
Democrats and Republicans on Capitol Hill alike are expressing growing concerns about the size of the largest tech firms and their market power. Democratic presidential candidate Elizabeth Warren has called for breaking up companies like Amazon, Apple, Google and Facebook and unwinding prior acquisitions.
Last week, the House Judiciary Committee’s antitrust panel pressed executives from the four firms about their competitive practices and noted that Google, Facebook, Amazon had a rising share of key markets.
Congress held a series of hearings last year looking at the dominance of major tech companies and their role in displacing or swallowing up existing businesses. It is rare for the government to seek to undo a consummated deal. The most famous case in recent memory is the government’s effort to break up Microsoft Corp. The Justice Department won a preliminary victory in 2000 but was reversed on appeal. The case settled with Microsoft intact.
“There is growing consensus among venture capitalists and startups that there is a kill zone around Google, Amazon, Facebook, and Apple that prevents new startups from entering the market with innovative products and services to challenge these incumbents,” said Representative David Cicilline, a Democrat who heads the subcommittee.
Apple CEO Tim Cook told CBS News last month that scrutiny was fair but “if you look at any kind of measure about is Apple a monopoly or not, I don’t think anybody reasonable is going to come to the conclusion that Apple’s a monopoly. Our share is much more modest. We don’t have a dominant position in any market.”
Google’s Adam Cohen told the House Judiciary subcommittee last week that the company had “created new competition in many sectors, and new competitive pressures often lead to concerns from rivals.”
Technology companies face a backlash in the United States and across the world, fueled by concerns among competitors, lawmakers, and consumer groups that they have too much power and are harming users and business rivals.
U.S. President Donald Trump has called for closer scrutiny of social media companies and Google, accusing them of suppressing conservative voices online, without presenting any evidence. (REUTERS)
Amazon.com Inc. on Tuesday joined Apple Inc. in the $1 trillion club, becoming the second member of the group after its stock price doubled in 15 months.
If the online retailer’s share price continues at its recent pace, it will be a matter of when not if, Amazon’s market valuation eclipses that of iPhone maker Apple, which reached $1 trillion on Aug. 2.
Apple took almost 38 years as a public company to achieve the trillion dollar milestone, while Amazon got there in 21 years. While Apple’s iPhone and other devices remain popular and its revenues are growing, it is not keeping up with Amazon’s blistering sales growth.
Amazon has impressed investors by successfully diversifying its business into virtually every corner of the retail industry, altering how consumers buy products and putting major pressure on many brick-and-mortar stores. It also provides video streaming services and bought upscale supermarket Whole Foods. And its cloud computing services for companies have become a major driver of earnings and revenue. — Reuters
Turks expressed differing opinions on Tuesday (August 14) after President Tayyip Erdogancalled on the nation to boycott electronic products from the United States, particularly iPhones, retaliating in a dispute with Washington that has helped drive the lira to record lows.
Hours after Erdogan‘s call, iPhone user Ayse Orga bought a new phone for herself at a bazaar selling electronics. Shopkeeper Umit Yilmaz voiced support for Orga.
“I have a 16-year-old daughter. Take her iPhone away from her, if you can,” Yilmaz said.
Another shopkeeper, Arif Simsek disagreed.
“We fully support this decision. We supported him with our lives on July 15 and now we will support him with our goods,” Simsek said, referring to the failed coup attempt in July 2016.
The lira has lost more than 40 percent this year and crashed to an all-time low of 7.24 to the dollar early on Monday (August 13), hit by worries over Erdogan‘s calls for lower interest rates and worsening ties with the United States.
The weakness of the Turkish currency has rippled through global markets. Its drop of as much as 18 percent on Friday (August 10) hit U.S. and European stocks as investors fretted about banks’ exposure to Turkey.
Erdogan says Turkey is the target of an economic war and has made repeated calls for Turks to sell their dollars and euros to shore up the national currency. — Reuters
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