Apple settled a consumer class action lawsuit for $53 million Tuesday, according to court documents filed in the U.S. District Court for the Northern District of California.
In the $53 million lawsuit,
Apple agreed to a cash payout to some 153,000 iPhone and iPod touch customers in relation to denied warranty coverage for its "liquid damage policy," IDG News Service reported.
The lawsuit was based on consumer complaints that accused Apple of failing to replace or repair their water-damaged phones under the company’s one-year standard or two-year extended warranty.
Apple did not admit any wrongdoing in the settlement.
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The settlement still requires judge’s approval in San Francisco's federal court.
In the suit, the plaintiffs contended that Apple's water contact indicator tape – which changes colors based on the extent of the water damage, failed to differentiate between whether the device's inability to function properly was due to water damage or an unrelated malfunction within the device.
Additionally, the tape's manufacturer – 3M, said that its tape could turn pink merely with humidity and not direct contact with a liquid, according to the plaintiffs.
In response, Apple contested 3M’s results stating that the tests were conducted on indicator tape open to the elements, and not contained inside a device, and at unrealistic extremes of temperature and humidity, IDG News Service reported.
As of November 2009 and May 2010, iPhone and iPod touch customers respectively had their policies changed to exclude coverage for "liquid spill or submersion" or "abuse."
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Those eligible for settlement funds include iPhones customers denied coverage before Dec. 31, 2009 due to the company's liquid damage policy, and iPod touch customers who were denied coverage before June 30, 2010.
Attorneys’ fees and reimbursement of litigation expenses reportedly amount to up to 30 percent of the proceeds.
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