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October 12, 2007

Apple, AT&T Face US$2.6 Billion Class Action Law Suit

iphone3.jpg

When it rains, it pours.

A class action suit filed last week in San Fancisco specifically targets Apple and AT&T for conspiring to tie iPhone customers to AT&T's wireless network. The claim, brought forth by lawyers for Paul Holman in Washington state and Lucy Rivello in California, files six charges that the two companies broke numerous state and federal laws as well as regulations and seeks punitive and other damages in excess of US$2.6 billion.

According to Macworld UK, the companies have also conspired to block all modifications to the iPhone in an attempt to prevent users or competitors from diminishing or tapping into the Apple/AT&T revenue stream. The suit also specifically charges that Apple blocked third-party applications, non-Apple ring tones sold through its iTunes Store and disabled unlocked iPhones with September's iPhone 1.1.1 firmware update.

Law firm Holman-Rivello asserts that the 1.1.1 firmware update amounts to digital bullying, alleging that Apple's warnings of "irreparable damage" to the handset through unlocking it was a lie. "Apple and AT&T agreed to go beyond these [previous] tactics and to take affirmative steps to break the iPhones of consumers who lawfully unlocked the AT&T SIM card or who installed third-party apps," the suit read.

Beyond the aforementioned damages, the suit is looking to void any agreement between Apple and AT&T as well as bar the firms from similar actions in the future.

A spokesperson from AT&T declined to comment on the suit while Apple has yet to reply to requests for comment as well.

Let us know what you think over in the comments or forums.

Posted by chrisbarylick at October 12, 2007 9:56 AM
Category: Legal
Buy from: Apple, iTunes, Amazon.

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Comments

What a joke. Just because these people want something, doesn't mean that it's their right to do it. Show me any other cell phone/carrier situation like this where it works differently.

Posted by: Burtonman at October 12, 2007 11:42 AM

$2.6 billion? Let me get this straight. If we assume 2 million iPhones sold, $2.6B translates into $1300 per iPhone sold. I hope these "wronged" claimants are holding their collective breaths.

Posted by: Mike Castaldi at October 12, 2007 6:24 PM

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