Apple has agreed to pay a $53 million settlement on a class action accusing the company of denying repairs for some of its mobile devices while they were still under warranty. The payout covers the original iPhone, the iPhone 3G, and the 3GS, along with the first three generations of the iPod touch.
According to several lawsuits combined in San Francisco, the Cupertino-based firm had denied repairs because the liquid contact indicator tape found in the headphone jack or charging port of devices had been activated – turning pink or red. Apple's warranty policy explicitly excludes repairs or exchanges over water damage. But it turns out the liquid contact indicator used to detect if a device has been exposed isn't 100% accurate, as 3M, the manufacturer itself has since indicated that humidity alone could trigger the mechanism in some cases.
Water damage indicator in iPhone 3G / 3GS
As it's often the case in these settlements Apple will admit no wrongdoing but is willing to compensate customers who feel they've been wronged. Customers will receive monetary compensation using the average replacement cost of their particular device at the time as a baseline, which ranges from $160 for the 8GB variant of the original iPod touch, all the way up to $300 for the 16GB iPhone. Of course payouts are proportional to the number of claims filed, so the more people join in, the less each affected user will receive.
Under the agreement, the company will take out an ad in both USA Today and Macworld to provide the website and contact information needed to file a claim, while potentially-affected customers will be contacted directly by mail as well. The settlement document, obtained by Wired, is expected to be filed in a San Francisco federal court and still needs to be approved by the court before it will go into effect.