The law firms of Folkenflik & McGerity and Hoffman & Lazear have filed a $1.2 billion class action suit on behalf of iPhone owners against Apple and AT&T Mobility (AT&T’s cellular unit) in US District Court. The case, Paul Holman and Lucy Rivello v. Apple, Inc., AT&T Mobility, LLC., claims that the companies’ agreements to restrict iPhone users to using only the AT&T cellular network for voice and data, and to restrict users to using only applications from Apple, run afoul of Federal antitrust laws, California antitrust laws, and California unfair trade practice laws. The suit goes on to say that Apple and AT&T are liable for “computer trespass”, based on the recent 1.1.1 iPhone software release, which disabled many SIM unlocks, third-party software, and left some users’ phones inoperable. The suit claims these changes were not technically required for the new features Apple was offering in the update.
“There is little question that Apple and AT&T have misused Apple’s programs to improperly coerce consumers to buy only AT&T voice and data services and only Apple programs. That is unlawful under both Federal and state laws, and any terms in Apple’s and AT&T’s contracts to the contrary are also unlawful and unenforceable,” said Max Folkenflik, one of the attorneys on the case. “Apple and AT&T have no more right or technological justification for forcing iPhone users to use only AT&T service and Apple applications than Ford would to force car owners to use only Ford batteries or tires, or than the maker of your television has to force you to watch only Fox or CBS.”
The suit calls for compensatory damages of $200 million, which are trebled according to law to $600 million, as well as for punitive damages of $600 million, and for injunctions prohibiting the alleged unlawful conduct and voiding the unlawful contract terms. More information, including a complete copy of the class action complaint, is available on the lawsuit’s website, appleclassaction.net.