iPhone 5 Lawsuit: Apple Ignored Defect Resulting in AT&T Data Overcharges

By Josh Long

AT&T wireless subscribers who used the Apple iPhone 5 incurred overage charges due to a defect that Apple identified nearly immediately but failed to resolve for years, according to a proposed class-action lawsuit.

Hagens Berman, the class-action law firm that sued Apple Thursday in federal court, claimed the defect impacted all versions of iOS 6 and 7 operating systems and was only resolved when Apple released iOS 8.1 in October 2014.

The defect allegedly resulted in data overcharges for consumers because iPhones that streamed videos or otherwise used large amounts of data via Wi-Fi networks automatically switched over to cellular networks. Apple failed to disclose the defect to consumers, leaving them with no warning that their phones were chewing up huge amounts of cellular data, the 29-page lawsuit alleged.

“Apple failed to report or fix this defect for years, leaving hundreds of thousands of iPhone users racking up month after month of data-overage charges,” said Steve Berman, managing partner of Hagens Berman. “We believe Apple should not have withheld this repair for any period of time, and seek to make these affected consumers whole.”

After consumers contacted Apple and phone carriers about the issue, Apple provided a repair on the Verizon network within days without acknowledging a defect existed, but the company failed to do so for AT&T Mobility subscribers, according to the complaint.

“In fact, while Apple provided a repair to the defect within two weeks to iPhone 5 owners on the Verizon network, iPhone 5 and 5s owners on the AT&T network had to wait over two years for a repair,” the lawsuit alleged.   

AT&T subscriber Thomas Palmer, who streamed YouTube and Netflix videos with his iPhone 5 and iPhone 5s, filed the proposed class-action lawsuit in U.S. District Court for the Northern District of California. The complaint alleged violations of the California Unfair Competition Law, Consumers Legal Remedies Act and False Advertising Law.

Apple, which released the iPhone 5 in September 2012, did not immediately respond Friday to a request for comment.