Apple fined $9m for breaching consumer law

Apple has been fined $9 million for falsely telling consumers that they had voided their warranties if they had their devices repaired by a third party.

The ACCC took Apple to court after investigating a series of complaints related to the ‘error 53’ bug that had disabled some iPhones and iPads after their owners downloaded an iOS update.

At least 275 customers affected by the bug were told by Apple that they were no longer eligible for a repair or replacement if their device had been previously repaired by a third party.

But the court held that Australian consumer law does not cease to apply based on the mere fact that the devices had been repaired by someone other than Apple.

“If a product is faulty, customers are legally entitled to a repair or a replacement under the Australian Consumer Law, and sometimes even a refund. Apple’s representations led customers to believe they’d be denied a remedy for their faulty device because they used a third-party repairer,” ACCC Commissioner Sarah Court said.

“The Court’s declarations hold Apple US, a multinational parent company, responsible for the conduct of its Australian subsidiary. Global companies must ensure their returns policies are compliant with the Australian Consumer Law, or they will face ACCC action.”

Since the ACCC commenced its investigation Apple has implemented an outreach program to compensate around 5000 consumers that were impacted by error 53.

The company has also offered a court-enforceable undertaking to improve staff training, audit information about warranties and Australian consumer law on its website, and improve its systems and procedures to ensure future compliance with the law.

Apple has also agreed to provide a new replacement rather than a refurbished device if the consumer requests one.

Image credit: ©iStockphoto.com/Robinpd

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