Apple has agreed to pay money to owners of older models of iPhones in the US after striking a US$500 million deal to settle legal action accusing Apple of slowing down older iPhones as it launched new models to induce owners to buy replacement phones or batteries.
The preliminary proposed class-action settlement requires approval by US District Judge Edward Davila in San Jose, California, Reuters reported.
It will see Apple pay consumers $25 per iPhone, which may be adjusted up or down depending on how many iPhones are eligible, with a minimum total payout of US$310 million.
Apple denied doing anything wrong and has settled the nationwide case to avoid the burdens and costs of litigation, court papers showed.
Apple, based in Cupertino, California, has not commented despite requests and it has not issued a media release on the settlement.
The settlement covers US owners of the iPhone 6, 6 Plus, 6s, 6s Plus, 7, 7Plus or SE that ran the iOS 10.2.1 or later operating system. It also covers US owners of the iPhone 7 and 7 Plus that ran iOS 11.2 or later before 21 December 2017.
Consumers argued that their iPhone’s performance deteriorated after installing Apple software updates. The consumers contended the deterioration led them into believing their iPhone was close to the end of its use, requiring replacements or new batteries.
The tech company attributed the problems mainly to temperature changes, high usage and other issues, and said its engineers worked quickly and successfully to address them. Analysts sometimes refer to the slowing of iPhones as “throttling”.
Lawyers for the consumers described the settlement as “fair, reasonable, and adequate”.
They called payments of US$25 per iPhone “considerable by any degree,” saying their damages expert considered US$46 per iPhone the maximum possible.
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.
Following an initial outcry over slow iPhones, Apple apologised and lowered the price for US$79 replacement batteries to US$29.