Antitrust Law Daily Wrap Up, ADVERTISING NEWS: Apple accused of falsely representing iPhone, iPad storage capacity, (Dec 31, 2014)

By Greg Hammond, J.D.

Consumers have filed a class action lawsuit in the federal district court in San Jose, California, against Apple Inc., alleging that the electronics giant has misrepresented the storage capacity of its 8 GB and 16 GB iPhones, iPads, and iPods. Apple faces a three-count complaint, asserting that it violated California’s Unfair Competition Law (UCL), False Advertising Law (FAL), and Consumer Legal Remedies Act (CLRA) (Orshan v. Apple Inc., December 30, 2013).

Consumers Paul Orshan and Christopher Endara purchased numerous iPhones and iPads, allegedly relying on Apple’s representations that the products have storage capacities of 8 GB or 16 GB. The two consumers claim, however, that Apple’s iOS 8 operating system consumes up to 23.1 percent of the advertised storage capacity, and that Apple failed to disclose the actual storage capacity available on the devices.

Orshan and Endara seek to represent two classes and subclasses, including: (1) an “iOS 8 Purchaser Class,” consisting of all persons or entities in the United States who purchased an iPhone, iPod, or iPad with represented storage capacity of 16 GB or less with iOS 8 pre-installed for purposes other than resale or distribution; (2) an “iOS 8 Purchaser CLRA Subclass”; (3) an “Upgrade Class,” consisting of all persons or entities in the United States who upgraded an iPhone, iPod, or iPad with represented storage capacity of 16 GB or less to iOS 8; and (4) an “Upgrade CLRA Subclass.”

Specifically, the complaint alleges that Apple: (1) violated the UCL by disseminating or causing to be disseminated unfair, deceptive, untrue, or misleading advertising, and the company continues to make such misrepresentations; (2) violated the FAL by disseminating false, misleading, and deceptive advertising regarding the products’ storage capacity to the general public through product packaging, product displays, labeling, advertising, and marketing, causing consumers to suffer monetary loss; and (3) violated the CLRA by representing that the devices had specific storage capacities that they did not in fact have, and for selling the products with the intent not to sell them as advertised. Orshan and Endara seek restitution, disgorgement of profits, attorney fees and costs, and injunctive relief.

The case is No. 5:14-cv-05659-NC

Attorneys: Jonas P. Mann (Audet & Partners, LLP), Charles J. Laduca (Cuneo Gilbert & Laduca LLP), Jon M. Herskowitz (Baron & Herskowitz), and Robert Shelquist (Lockridge Grindal Nauen PLLP) for plaintiffs.

Companies: Apple Inc.

News: Advertising StateUnfairTradePractices CaliforniaNews