Apple to pay up to $14.4M in iPhone throttling settlement approved by B.C. judge

A B.C. Supreme Court judge has approved a proposed settlement of up to $14.4 million from Apple to eligible members of a class-action lawsuit that accused the company of deliberately providing software updates that slowed some older iPhone models.

Apple, which denies the allegations, had earlier agreed to pay between $11.1 million and $14.4 million as part of the settlement. It says the settlement is not an admission of wrongdoing.

Depending on how many people apply for the settlement, claimants will receive between $17.50 and $150. They must provide a serial number for the impacted phone.

The settlement applies to residents in all provinces except for Quebec. Similar lawsuits were filed in Ontario, Saskatchewan and Alberta.

The judge ultimately decided that the proposed settlement was “fair, reasonable and in the best decision of the class,” said class counsel Michael Peerless in an interview with CBC News.

“Apple did the right thing and came forward and, in a sense, stood behind their product without making a legal admission that they did anything wrong. And that’s very normal” for a class action, Peerless said.

Apple customers who bought an iPhone 6, 6 Plus, 6s, 6s Plus, SE, 7 or 7 Plus with iOS 10.2.1 or later (for iPhone 6, 6 Plus, 6s, 6s Plus, or SE) and/or iOS 11.2 or later (for iPhone 7 or 7 Plus) before Dec. 21, 2017 may be eligible for the settlement, according to a website representing the class action.

Class members who submit an approved claim form over the next few months, which will be available in the coming days, will receive a cash payment from Apple. The deadline to opt out of the class action was Jan. 10.

The claims administrator will have a search feature to help people confirm their eligibility, added Peerless. “Not only does Apple want that kind of evidence, but we do, and the court does as well, because we don’t want people to be able to make fraudulent claims,” he said.

A similar case in the U.S. saw the company settle with iPhone users whose devices were throttled by software updates, diminishing the phones’ performance and battery life.

The California case settlement range was between $310 million US and $500 million US.

CBC News has reached out to Apple for a statement.

Transparency concerns around software updates

Several people reacted favourably to the news while walking outside in downtown Toronto.

“I think it’s great because [Apple is] big enough, and they took all that money from other people. They should give it back,” said Vito Cosentino, who said he’s sure he had one of the impacted models but won’t have proof to claim the settlement.

Another pedestrian shared similar sentiments. “It’s not obviously a huge sum of money that’s being distributed, but I understand that there’s probably a ton of people who would be part of this lawsuit, so yeah … any amount helps,” Hannah Weinberg told CBC News.

Benjamin Tan, an assistant professor of electrical and software engineering at the University of Calgary, said that many companies have moved toward a new software update at least every month to fix bugs and add new features.

But those updates can include software which further degrades the phone, leading consumers to purchase a new model sooner than they would have otherwise.

“There’s a lot in the digital world that we don’t necessarily have full control over anymore, partly because the systems are really complicated,” said Tan.

Lack of clarity around software updates ’cause for concern,’ expert says

Benjamin Tan, an assistant professor at the University of Calgary with expertise in hardware security, says companies don’t always make it clear what they are doing in a software update, but urges people to pay attention and install them as they come.

“In this particular case, though, what was I think cause for concern was that companies don’t always make it very clear exactly what they’re updating,” he added.

“And when they don’t really advertise in advance that these might be some of the side effects that happen to address battery issues or security flaws or something, that’s usually [when] people say, ‘Hang on, what’s going on here? This wasn’t really anticipated.'”

‘Tucked away in the sock drawer’

Alex Sebastian, the co-founder and COO of Orchard, a Canadian company that resells used iPhones, said his customer service team noticed that there was an uptick in reported slowdowns among iPhone 6, 6S and 7 models after the iPhone 8 was introduced alongside iOS 11 in 2017.

“Customers were starting to call in to talk about their phone slowing down and asked what can be done about it, and the short answer is, there wasn’t a lot that we could do to help them out there,” Sebastian told CBC News.

“I think it’s pretty conservative to estimate that 10 million Canadians bought one of those generations of phones, so that’s 10 million potential claimants you have out there,” he said.

At the time, iPhone users were upgrading their phones every 24 to 28 months on average, he said. Today, the turnover rate is more like 30 to 33 months.

Eligible claimants will be able to apply for a max of $150 from the settlement pool, which is more than the cost of replacing a battery on one of the impacted phone models today — and on par with what it would have cost to do so several years ago, according to Sebastian.

“I think there’s a lot of outcomes where claimants are not receiving the full $150, because there is an upper limit of $14[.4] million dollars on the entire settlement,” he said.

“I think that a lot of people probably have disposed of their phones by now. But there’s certainly going to be a meaningful proportion who have tucked it away in the sock drawer, that can go find that phone and pull the serial number off and make a claim here.”