Confidential
Settlement – $20,000,000Judge
Court
San Mateo Superior
Attorneys
Plaintiff
Steven N. Williams
(Steve Williams Law PC)
Defendant
Facts
Lisa Chin and other iPod purchasers are the plaintiffs in this breach of warranty/false advertising class action lawsuit against Apple Computer Corporation. In 2001, Apple Computer Corporation, Cupertino, introduced the first model of the new product, iPod, a pocket-sized device that plays music stored as mp3s. This product has a rechargeable battery and was initially advertised as being able to play music for 10 hours on one battery charge. Over the next few years, the second and third models were introduced. These were advertised as being able to run for eight hours per charge. Moreover, in 2002, Apple began to state in advertisements that the iPod's battery would last for the life of the product. However, the ads lacked an estimated for the life of the product. About 1.3 million individuals purchased the first, second and third models of the product at prices of about $250 to $500. In December 2003, attorneys began to file class action suits on behalf of iPod owners against Apple Computer. In 2004, these suits were consolidated in San Mateo Superior Court and plaintiffs claimed breach of warranty and false advertising.
Damages
Prior to the settlement, there was no presented estimation of plaintiffs' damages to the defendant.
Result
The parties agreed to settle the case. The terms of the settlement entitle purchasers of the first two models of iPod to either $25 in cash or $50 credit at the Apple store. Also, first and second model purchasers who had paid Apple to repair their batteries are entitled to reimbursement of up to half the cost of such repairs. The counsel for the plaintiffs projected the settlement amount to be approximately $20 million. However, the exact amount of the settlement will not be known until May 2006, which is the deadline for all claims to be submitted under the settlement agreement.
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