Scarinci Hollenbeck, LLC
The Firm
201-896-4100 info@sh-law.comFirm Insights
Apple to Settle Class-Action Lawsuit Over Rogue App Purchases By Kids
Author: Scarinci Hollenbeck, LLC
Date: March 15, 2013
Key Contacts
Back
Apple Inc. has reportedly agreed to settle a class-action lawsuit over applications (apps) purchased through its online marketplace. Five parents sued the company after their children inadvertently made purchases in apps that purported to be free.
According to the plaintiffs’ complaint, “Apple failed to adequately disclose that third-party Game Apps, largely available for free and rated as containing content suitable for children, contained the ability to make In-App Purchases.”
Apple requires users to authenticate their accounts by entering a password prior to purchasing and/or downloading an app or buying game currency. However, up until early 2011, once the password was entered once, Apple permitted users to buy game currency for up to fifteen minutes without re-entering the password. As a result, the plaintiffs’ children racked up bills ranging from $99.99 to $338.72 at a time.
The case posed an interesting contract issue. As detailed in court documents, the plaintiffs maintained that each in-app purchase constituted a separate and voidable contract between Apple and their minor children, which could be subsequently disaffirmed by a parent or guardian on behalf of the minors. Under their theory, “a contract between Apple and minor existed each time that (1) Apple offered to sell game currency to a minor playing an app, (2) the minor accepted Apple’s offer, and (3) the transaction was supported by consideration, or payment made by the Plaintiffs.”
Meanwhile, Apple argued that the relevant contractual relationship governing the in-app purchases existed solely between Apple and plaintiffs. Citing the original Terms & Conditions signed by the plaintiffs, it contended that the purchases were not voidable. Moreover, Apple argued that the Terms & Condition specifically hold the account holder liable for any unauthorized purchases.
Since the case was settled, we will never know how the court would have ruled on these issues. Under the terms of the settlement, Apple will provide a $5 iTunes store credit to impacted customers, which could reach 23 million. In addition, class members claiming $30 or more from Apple may elect to receive a cash refund. Overall, the settlement is expected to cost Apple $100 million.
If you have any questions about this case or would like to the legal issues involved, please contact me, Christine Vanek, or the Scarinci Hollenbeck attorney with whom you work.
- Locations: Red Bank, NJ, New York City, Washington, D.C., Little Falls, NJ
No Aspect of the advertisement has been approved by the Supreme Court. Results may vary depending on your particular facts and legal circumstances.
Related Posts
See all
What to Do If You Are Impacted by a Retailer Bankruptcy Part 2
Over the past year, brick-and-mortar stores have closed their doors at a record pace. Fluctuating consumer preferences, the rise of online shopping platforms, and ongoing economic uncertainty continue to put pressure on the retail industry. When a retailer seeks bankruptcy protection, a myriad of other businesses are often impacted. Whether you are a supplier, customer, […]
Author: Brian D. Spector
The Current Administration's Proposals for the Financial Services and Banking Industries Will Affect Your Business
Since his inauguration two months ago, Donald Trump’s administration and the Congress it controls have indicated important upcoming policy changes. These changes will impact financial services policies and priorities. The changes will particularly affect cryptocurrency, as well as banking rules and regulations. Key Regulatory Changes in Cryptocurrency For example, in the burgeoning cryptocurrency business environment, […]
Author: Dan Brecher
Tips for Commercial Landlords Impacted by Wave of Retailer Bankruptcies Part 1
The retail sector has experienced a wave of bankruptcy filings over the last year. Brick-and-mortar businesses in financial distress include big-name brands like Big Lots, Party City, The Container Store, and Vitamin Shoppe. When large retailers seek bankruptcy protection, they are not the only businesses impacted. Landlords can be particularly hard hit. While commercial landlords […]
Author: Brian D. Spector
How Understanding Bankruptcy Trends Can Benefit Your Business
The bankruptcy legal landscape presents both challenges and opportunities for businesses navigating financial distress. Understanding current bankruptcy trends can help businesses make more informed and strategic decisions. Corporate Bankruptcy Filings Trending Upwards Bankruptcy filings continued to trend upwards in 2024. According to statistics released by the Administrative Office of the U.S. Courts, personal and business […]
Author: Brian D. Spector
SEC Takes Actions Against Issuers for Failure to File Form D
In December, the U.S. Securities and Exchange Commission (SEC) announced charges against two privately held companies for failing to file a Form D notice, which is generally utilized for exempt securities offerings. Here, the SEC’s enforcement sends a strong message: compliance with regulatory requirements is not optional and failure to comply can have significant consequences. […]
Author: Kenneth C. Oh
Redefining Labor Relations: NLRB's Pivot from Abruzzo’s Memoranda
On February 14, 2025, the Office of General Counsel (OGC) of the National Labor Relations Board (NLRB) under Acting General Counsel William B. Cowen issued Memorandum 25-05, “New Process for More Efficient, Effective, Accessible and Transparent Case handling.” The Memorandum rescinds nearly all of the Memoranda issued by his direct predecessor, Jennifer Abruzzo, setting the […]
Author: Matthew F. Mimnaugh
No Aspect of the advertisement has been approved by the Supreme Court. Results may vary depending on your particular facts and legal circumstances.
Sign up to get the latest from our attorneys!
Explore What Matters Most to You.
Consider subscribing to our Firm Insights mailing list by clicking the button below so you can keep up to date with the firm`s latest articles covering various legal topics.
Stay informed and inspired with the latest updates, insights, and events from Scarinci Hollenbeck. Our resource library provides valuable content across a range of categories to keep you connected and ahead of the curve.