Facts

Through Apple's App Store, consumers could download Apps onto the iPhone smartphone, the iPod Touch handheld computer, or the iPad tablet computer. Some Apps could be transferred to the Apple Watch smartwatch or fourth generation or newer Apple TV as extensions of iPhone Apps. Meanwhile, Apple Family Sharing was a service of the App Store through which Apple purports to allow six family members to share Apps purchased. According to Apple's advertisements, with Family Sharing, once one family member purchases an App, it becomes immediately available to all other family members' devices. To set up Family Sharing, the initiating user designated up to five other users as "family" in the initiator's Apple Account. The family member must consent to entering the Apple family. Once any family member purchases an App which supports Family Sharing through the App Store, paying a single time for that App, the purchased App becomes available for download on the devices of the other family members. Apple requested that its software developers place a small advertisement on the landing pages for its Apps which states that the App supports Family Sharing. Family Sharing also featured prominently in Apple's marketing of its devices, including iPhones, iPads, and laptops. Apple's website stated: "Share apps, movies, music and more with your whole family. Family Sharing lets you share the things you love with the people you love, so you don't all have to buy the same stuff over and over. It's simple to set up, and gives everyone in your family access to shared iCloud storage." On January 30, 2019, Apple changed the advertisements on the landing pages of its subscription-based Apps to read: "In-app purchases can't be shared with family members." On June 21, 2019, Walter Peters, individually and on behalf of all others similarly situated, brought a class action against Apple Inc., alleging intentional misrepresentation, negligent misrepresentation, negligence, false advertising, and violations of California's False Advertising Law, Unfair Competition Law, and Consumer Legal Remedies Act. On September 3, 2019, Peters filed a First Amended Complaint that omitted the prior Lanham Act claim. On March 14, 2022, plaintiffs sought to certify a class that included all persons who initiated the purchase of a subscription to an app through the Apple App Store, excluding subscriptions to first-party Apple apps, during the period June 21, 2015 through January 30, 2019, while enrolled in a Family Sharing group that had at least one other member at the time of the purchase, and who Apple's records indicated were residents in the United States at the time of the purchase. Excluded from the class were all employees, officers, or agents of Defendant Apple Inc., as well as all judicial officers assigned to this case and their staff and immediate families.

PLAINTIFF'S CONTENTIONS: Plaintiff contended that defendant misrepresented the ability to use its Family Sharing feature to share subscriptions to apps. Plaintiff argued that as a result of defendant's deceptive and misleading practices he was induced to purchase subscription-based Apps for which defendant received hefty fees, believing that those Apps could be shared with up to six family members. However, plaintiff alleged that in reality, the Apps were only available to the single user who set up the subscription. Moreover, plaintiff maintained that defendant made millions in fraudulent sales to individuals who thought they were receiving more than one subscription, while defendant's customers did not receive the benefit of the bargain.

DEFENDANT'S CONTENTIONS: Defendant denied all contentions.

Result

Apple Inc. agreed to pay $25 million to settle all claims.