Attorney General Mark R. Herring has secured a $113 million settlement with Apple, Inc. regarding Apple’s alleged 2016 decision to throttle consumers’ iPhone speeds to address unexpected shutdowns in some iPhones. Attorney General Herring joins a bipartisan coalition of over 30 state attorneys general in reaching this settlement with Apple. Under the terms of the agreement, Apple will pay Virginia $2,648,658.22.
“For years, Apple willingly and knowingly concealed defects in its iPhone models, going as far as to install a software update to intentionally hide those defects,” said Attorney General Herring. “Apple did not tell consumers that the software update reduced the performance of their phones, and, in fact, profited off the intentional slowdown when consumers upgraded their phones because of the reduced performance. I will not allow businesses like Apple to take advantage of Virginia consumers and I’m glad that we were able to reach a settlement that holds them accountable for their deceptive conduct.”
Based on the multistate investigation, Attorney General Herring and his colleagues allege that Apple discovered that battery issues were leading to unexpected shutdowns in iPhones. Rather than disclosing these issues or replacing batteries, however, Apple concealed the issues from consumers. Apple’s concealment ultimately led to a software update in December 2016 that reduced iPhone performance in an effort to keep the phones from unexpectedly shutting down.
Additionally, Attorney General Herring and his colleagues allege that Apple’s concealment of the battery issues and its decision to throttle the performance of consumers’ iPhones led to Apple profiting from selling additional iPhones to consumers whose phone performance had, in fact, been slowed by Apple. In his Complaint, Attorney General Herring alleges that this conduct violated the Virginia Consumer Protection Act.
Under the settlement, Apple will pay Virginia $2,648,658.22. In addition to the monetary payment, Apple also must provide truthful information to consumers about iPhone battery health, performance, and power management. Apple must provide this important information in various forms on its website, in update installation notes, and in the iPhone user interface itself. Apple also recently entered into a proposed settlement of class action litigation related to the same conduct, and under that proposed settlement Apple will pay out up to $500 million in consumer restitution.
The settlement, in the form of a Consent Judgment, will be filed for approval with the Richmond City Circuit Court.
Joining Attorney General Herring in this settlement are the attorneys general of Alaska, Arizona, Arkansas, California, Connecticut, Florida, Hawaii, Idaho, Illinois, Indiana, Iowa, Kansas, Kentucky, Louisiana, Michigan, Minnesota, Missouri, Montana, Nevada, Nebraska, New Jersey, North Carolina, North Dakota, Ohio, Oregon, Pennsylvania, South Carolina, Tennessee, Texas, Utah, Vermont, Wisconsin and the District of Columbia.