Apple Offers To Pay Customers $53M In LCI Settlement
April 12, 2013

Apple Offers To Pay Customers $53M In LCI Settlement

Michael Harper for — Your Universe Online

Apple has a famously good track record when it comes to customer service. Any Apple fan can likely share more than one story about a Genius going the extra mile for them. Some early iPhone and iPod Touch owners, on the other hand, likely felt burned by Apple´s warranty and replacement policies. Some of these customers banded together to file a class action lawsuit against Apple over these warranty practices and, according to Wired, the iPhone maker has recently decided to pay out $53 million to settle the suit.

Apple has proposed this settlement, but the court still needs to approve this action before customers can collect their portion of the money.

The issue at hand in this case is the little white strips of material found in iPhones before 2010. Like many other phone makers, Apple placed a white liquid contact indicator (or LCI) inside these devices, just inside the headphone jack. When water touches this strip, it turns pink or red, indicating the device was likely dunked in some water, potentially ruining the innards. At the time, Apple would refuse to exchange or repair phones that had encountered water, thoroughly upsetting some customers. No matter what problem the device was experiencing, if the LCI had been triggered, Apple refused service. The company that makes the LCIs, 3M, later said these indicators could be triggered by certain levels of humidity without any other kind of liquid contact. Many customers took Apple to court over the deal in 2010 and, as the case progressed, their matters were eventually merged into one class action suit.

The affected devices include the original iPhone, iPhone 3G and iPhone 3GS as well as the first three generations of iPod Touch.

Customers who brought suits against Apple will one day be able to collect a proportional amount, depending on which device they bought and had an issue with. For instance, customers with an 8GB iPod Touch may get around $160 in the settlement. Similarly, 16GB iPhone customers could earn as much as $300 as reimbursement for the cost of their phone. No customer will earn more than double what they paid for the device.

Apple must also post an ad in USA Today and Macworld guiding affected customers to the appropriate website to learn how they can also get their money.

In true Apple fashion, the company has only agreed to pay out money to these customers and has made it quite clear they don´t feel as if they´ve done anything wrong.

"Apple has agreed to enter into this Settlement Agreement to avoid the further expense, inconvenience, and distraction of burdensome litigation," reads the document obtained by Wired.

Customers who were denied service between 2007 and 2010 will be able to collect their money once the federal court approves Apple´s settlement proposal. It could be approved “in the coming weeks.”

Apple no longer adheres to the same repair and warranty policies, of course. The company now uses different methods for detecting water damage and offers the customer an option to replace a broken iPhone for $199, instead of full price. Customers who opt for the AppleCare+ program are awarded with multiple phone replacements at only $50 apiece.