Nature of the Action

 

This is a consumer class action brought by Plaintiff on behalf of himself and all others similarly situated who acquired, in the United States and its territories and its protectorates, Apple's iPhone 4, iPhone 4s and iPhone 5 (collectively, the "iPhones") and experienced reduced functionality of their iPhones as a result of the updates to iOS, essentially forcing consumers to render their iPhones obsolete.

 

Apple debuted the iPhone in 2007. Since the first generation iPhone, Apple has released a new iPhone model every year: the iPhone 3G in 2008, the 3GS in 2009, the 4 in 2010, the 4s in 2011, the 5 in 2012, and the iPhone 5c and 5s in 2013.

 

When the iPhone first debuted, it was described by the Wall Street Journal as "a beautiful and breakthrough handheld computer." Every iPhone comes equipped with a mobile operating system called iOS, which, according to Apple, is the "foundation of iPhone, iPad, and iPod touch." iOS consists of a collection of software applications, known as "apps," that allows users to utilize all of the features of Apple products.

 

Since the iPhone was first released there have been many versions of iOS, the most recent being iOS 7 and its update iOS 7.1.Apple has released updates to iOS since the first iPhone.

 

The first iOS update, iOS 1.1.1, was released a mere three months after the original iPhone was released. iOS 1.1.1 added the iTunes Wi-Fi Music Store, which gave users the ability to download music directly on their iPhones. Since iOS 1.1.1, Apple has released numerous iOS updates, all of which add new features to the iPhone it is downloaded on.

 

Purportedly, users are prompted to download the newest iOS version onto their device via a message from Apple when it is released. A true and correct representation of the alert received by users to download iOS 7 appears below:

 

(Note: Patently Apple added the red circle to the example found in the court document to highlight the words "Download and Install" as it's part of the so-called "promting" noted in the prior paragraph above)

 

Users have experienced vastly reduced functionality of their iPhones, including, most notably, Wi-Fi and Bluetooth connectivity issues, after downloading iOS updates onto their iPhones.

 

For example, as alleged herein, the Wi-Fi and Bluetooth connectivity issues experienced by users (the "Wi-Fi/Bluetooth Connectivity Issue" or "Grayed out Issue") appears to be most prevalent to iPhone 4s users who downloaded iOS 7.

 

The iPhone 4s is the fifth generation in a line of touchscreen based smartphones designed, developed and marketed by Apple. When the iPhone 4s was first launched, it came standard with iOS 5.0. According to Apple, iOS 7 is a platform for over a million mobile apps, iCloud, and includes security features that prevent unauthorized access to Apple devices. iPhone 4s is the oldest generation iPhone currently sold by Apple. It comes in black or white, 8, 16, 32 or 64 GB models and is available for use on AT&T, Verizon, T-Mobile and Sprint networks.

 

The iPhone 4s and its predecessor, the iPhone 4, share the same stainless steel body type, but are distinguished by the addition of Siri and iCloud in the iPhone 4s. Siri is speech recognition software that comes standard on every iPhone 4 and iPhone 5. It allows users to verbally give their iPhones commands and tasks to complete. Because Siri is capable of both speech input and output, it can purportedly "speak" back to its user. For example, if you ask Siri to add an item to your personal calendar, it is programed to make the addition to your calendar and verbally confirms that the task is completed.

 

A true and correct depiction of Apple's representation of how Siri replies to iPhone users' voice commands appear below:

 

 

Siri requires either a Wi-Fi or Network connection. When using a Wi-Fi connection for features like Siri, users do not risk incurring overage charges as a result of exceeding the allotted data in a data plan purchased by the user's cellular network, like Verizon, Sprint or AT&T (herein after "Network" or "Network connection").

 

In addition to Siri, the iPhone 4s originally came equipped with iOS 5. According to Apple, iOS 5 was the first version of iOS to introduce iCloud, described by Apple as "a breakthrough set of free new cloud services that work seamlessly with applications on your iPhone®, iPad®, iPod touch®, Mac® or PC to automatically and wirelessly store your content in iCloud and automatically and wirelessly push it to all your devices."

 

Apple prominently features iCloud in many of its iPhone 4s and iPhone 5 advertising campaigns. iCloud is purportedly able to save or backup data to the cloud, such as photos, videos, purchased music, movies, apps, books, TV shows, device settings, ringtones and other features. This allows users to access data stored on the cloud on any Apple device, regardless of the device the information was originally stored on.

 

[Apple's] iCloud is a feature on all iOS versions beginning with iOS 5 and including iOS 7. As stated by Apple, regardless of whether an iPhone is equipped with iOS 5, 6, or 7, iCloud can only wirelessly backup data when the iPhone is locked, connected to a power source and Wi-Fi is turned on and connected. iCloud is unable to backup data on a Network connection alone, and can only do so via a Wi-Fi connection.

 

Below is a true and accurate representation of the iPhone's Storage & Backup screen, which states that iCloud backups occur when the device is "plugged in, locked, and connected to Wi-Fi."

 

Apple unveiled iOS 7 on June 10, 2013. The update was described by Apple as "the most significant iOS update since the original iPhone[.]" The update, which could only be downloaded wirelessly via a Wi-Fi connection, changed the entire look of iPhone's interface and added hundreds of new features, some of which include: "Control Center, Notification Center, improved Multitasking, AirDrop®, enhanced Photos, Safari®, Siri® and . . . iTunes Radio™, a free Internet radio service based on the music you listen to on iTunes®."

 

Purportedly, iOS 7 added new apps and dramatically increased the efficiency and performance of apps. As of January 2014, there were over one million apps available for download to iPhone, iPad and iPod touch. While some apps may be downloaded using data from a data plan purchased by the user's cellular Network, large apps cannot be downloaded wirelessly over a Network connection, and must be downloaded over a properly operating Wi-Fi network. For example, system updates, like iOS 7, cannot be downloaded wirelessly over a Network connection, only a Wi-Fi connection.

 

Although previous iPhones had Bluetooth, the iPhone 4s was the first equipped with Bluetooth 4.0. According to Apple, Bluetooth allows users to "[e]xchange or synchronize data between Bluetooth enabled computers and devices," "[u]se a Bluetooth enabled wireless keyboard or mouse," "[c]onnect wirelessly to a Bluetooth compatible printer, headset, headphones, or speakers," and "[s]hare your internet connection with other Bluetooth enabled devices." Mike Foley, executive director of the Bluetooth Special Interest Group, commented on the new Bluetooth technology available on the iPhone 4s: "It enables an entirely new class of product into the Bluetooth world."

 

Defendant's advertising and marketing campaigns for the iPhone 4, iPhone 4s and iPhone 5 were and are designed to induce consumers to acquire or purchase the iPhones over other smartphone devices because of their Bluetooth and Wi-Fi connection capabilities, large library of apps, iCloud and Siri – all of which require a Network connection or Wi-Fi connection to operate. While users may access some features of iCloud without a Wi-Fi connection, in order to backup and save new data to iCloud, the iPhone must be connected to a Wi-Fi connection, locked and plugged into a power source.

 

In its promotions for iPhones 4, 4s and 5, Defendant highlights the iPhone's ability to download later generations of iOS, such as iOS 7. With each update, users receive all the features ofthe newest iPhone model that are supported by their iPhone. According to Apple, "because iOS 7 is engineered to take full advantage of the advanced technologies built into Apple hardware, your devices are always years ahead – from day one to day whenever."

 

The ability to update the iOS platform on a device is a major draw for consumers because every iOS update adds new features to an older device. For example, when users downloaded iOS 7, not only did their devices inherit new apps and features, iPhone's interface was redesigned to a "simpler, more useful, and more enjoyable" interface. In addition, the update added iTunes radio and an updated photos app which allows users to add filters to photos and auto enhance, rotate, correct red-eye, crop a panorama photo and share photos. iOS 7 also added a Control Center feature and security updates.

 

Notwithstanding Apple's extensive multi-million dollar advertising campaign showcasing the iPhone's ability to wirelessly download the latest features and apps from new versions of iOS, backup and store data using iCloud, and the iPhone 4s and 5's Wi-Fi and Bluetooth connection capabilities, the iPhones failed to perform as advertised for Plaintiff and members of the Class when the iOS 7 update was downloaded.

 

In addition, because of the Grayed out Issue, Plaintiff and Class members who downloaded iOS 7 onto their iPhones discovered their Wi-Fi and Bluetooth were rendered unusable. For example, after the update, they could not wirelessly download any iOS patches or versions because such downloads require a Wi-Fi connection and cannot be downloaded over a Network connection. This meant that Plaintiff and members of the Class could not wirelessly download iOS 7.0.6, which provided, for example, a patch for a major security flaw in iOS 7, as detailed in paragraphs 50-52 below.

 

[Note: For the sake of convenience, Patently Apple is now including paragraphs 50-52 out of sequence so that you can follow the attorney's argument in a continuous fashion as follows:

 

[#50] "Soon after iOS 7 was released, it was revealed that the update had a major security flaw requiring users to download a software patch, iOS 7.0.6, to fix. iOS 7.0.6 was the sixth update to iOS 7. This security flaw in iOS 7 effected how the software validates SSL certificates, which are critical in establishing secure sessions. To establish secure sessions, websites or devices "verfi[y] that the information is coming from a trusted source. By validating the certificate, the bank website knows that the request is coming from the user, and is not a spoofed request by an attacker. The browser also relies on the certificate to verify the response came from the bank's servers and not from an attacker sitting in the middle and intercepting sensitive communications."

 

[#51] In describing the iOS 7.0.6 patch, Apple stated on its website that the reason for the patch was that "[a]n attacker with a privileged network position may capture or modify data in sessions protected by SSL/TLS." Devices without the patch are vulnerable to attack by hackers who "could intercept, and even modify, the messages as they pass from the user's iOS 7 device to secured sites, such as Gmail or Facebook, or even for online banking sessions." Users cannot download iOS updates over 3G/4G or LTE connections.

 

[#52] In an article titled "Apple's Serious Security Issue: Update Your iPhone or iPad Immediately," the New York Times stressed the importance of downloading the security issue patch. The article explained: 'In a nutshell, Apple has a security hole in both its mobile and desktop operating systems that could let a malicious hacker jump in on what you think is a secure Web transaction if you're on a public Wi-Fi network like those at a coffee shop, airport or some other location. . . . Thanks to this flaw, your browser can't verify the authenticity of an encryption certificate, meaning someone could easily be pretending to be your bank's website, your doctor's office site or a credit card application form."]

 

After downloading iOS 7, Plaintiff and Class members' iPhones' Bluetooth and Wi-Fi connections became "grayed out" and unusable. This particular problem is referred to on Apple message boards as "grayed out" because the option to turn Wi-Fi on in the iPhone's setting turns gray and cannot be turned on. A true and correct depiction of this problem is displayed below (to the left), as well as how the screen looks when the option to turn Wi-Fi on is available (to the right):

 

 

The iPhone 4s pre-sold over one million units and sold over four million units worldwide the weekend following its release, and the iPhone 5 sold over five million units within the first three days of its launch.

 

Defendant's message alerts, notifying iPhone users that an iOS update is available, were also effective. As of March 21, 2014, 85% of active Apple devices had Downloaded and were running on iOS 7. Once Plaintiff and Class members downloaded iOS 7 onto their iPhones, they were unable to connect to Wi-Fi or Bluetooth. Because of the Grayed out Issue, Plaintiff and Class members could no longer access often free Wi-Fi and thus used data unnecessarily and/or incurred data charges for all data used on their iPhone 4s. In addition, Plaintiff and Class members could no longer backup their device using iCloud, wirelessly download iOS patches or the newest versions of iOS.

 

Defendant's misrepresentations concerning: (i) the iPhones' ability to download and run iOS 7 effectively; (ii) Bluetooth and Wi-Fi connection capabilities; and (iii) the ability to upgrade to new iOS software and run new applications and features, are misleading, false, and reasonably likely to deceive and have deceived Plaintiff and members of the putative Class.

 

Defendant designed, manufactured, marketed, and warranted the iPhone 4, iPhone 4s, Phone 5 and iOS 7 to consumers nationwide. In conjunction with each sale of the iPhone 4, iPhone 4s and iPhone 5, Defendant marketed, advertised and warranted, among other things, that each iPhone 4s was: (i) capable of downloading and running future versions of iOS, such as iOS 7, without adverse effects to the device's Wi-Fi and Bluetooth connection capabilities; (ii) was able to run applications via a Wi-Fi connection; (iii) was able to backup data using iCloud and was otherwise fit for the ordinary purpose for which such goods are used; and (iv) was free from defects in materials and workmanship.

 

Plaintiff and members of the Class have damages, in that they purchased and/or own an iPhone 4, iPhone 4s or iPhone 5, downloaded iOS 7 at Defendant's instruction, and would not otherwise have purchased and downloaded had they known they would be unable to use Wi-Fi or Bluetooth.

 

Defendant knew or should have known that the iPhones were defective in design and/or manufacture, were not fit for their ordinary and intended use, and did not perform in accordance with the advertisements, marketing materials, and warranties disseminated by Defendant in its nationwide marketing and advertising campaign. In addition, Defendant knew or should have known that the iPhones did not conform with the reasonable expectations of ordinary consumers. Indeed, Defendant has received hundreds of comments regarding the iPhone 4s and 5's Wi-Fi an Bluetooth connectivity issues since iOS was released.

 

Plaintiff brings this action on behalf of himself and all other similarly situated consumers who purchased and/or own the iPhone 4, iPhone 4s or iPhone 5 and experienced Wi-Fi and Bluetooth connectivity issues after downloading iOS 7, in order to halt the dissemination of Apple's false and misleading advertising message, and to obtain redress for those who have acquired an iPhone 4, iPhone 4s or iPhone 5. Plaintiff alleges violations of the Consumers Legal Remedies Act, California Civil Code §1750, et seq. (the "California Act"); violations of the Unfair Competition Law, California Business and Professions Code §17200, et seq. (the "UCL"); breach of express warranty; intentional misrepresentation; and negligent misrepresentation.

 

Class Action: Seeking More than $5 Million Dollars

 

The "Nature of the Action" section of the complaint laid out the foundation of the case. The formal complaint after this point goes into more specifics and notes that the more than 100 member Class action lawsuit is seeking more than $5 million dollars according to what's legally available to them in a case of this nature.

 

The court document also included a number of discussion threads. Here's just one thread found on Apple's support site titled "Wifi greyed out on iphone 4s with ios 7" (unedited).

 

Haymen

Sep 22, 2013 5:12 PM

What happened with me is really the same except Wifi was working for almost a day

but suddenly both Wifi and Bluetooth has stopped at once please any advice????

 

nealfrirl

Sep 25, 2013 5:03 AM

I have this EXACT problem too. The Wifi is generally greyed out, then after

restarting it about 50 times, updating it 12 time, standing on my head and doing the

twist it comes back but only briefly.

I'm spending a fortune on 3G because of it!

My bluetooth is also affected. HEEEELP!

 

Hi. I have the same problem. WIFI and bluetooth are grayed out and I can not turn

them on. Hope that this is some software issue. I dont want to replace any hardware

because I am out of warranty. I have iphone 4S 16GB with IOS7.54

loniep

 

Sep 30, 2013 3:48 AM

I've had the same problem since updating to ios7 (greyed out wifi etc.). I've been on

Apple chat for over 2 hours and they are not prepared to fix (as out of warranty). I

went to my cellular provider (Vodafone) who state that it is a known issue by Apple!

They won't fix the phone for free even though it's a result of an ios update! They've

told me (on Apple Chat) that the ios update only highlighted the problem - the

hardware was 'about' to fail in any case! Not sure how true that is!55

 

iPhoneandy

Sep 30, 2013 1:17 PM

Same here, it sounds like full BS from apple. WiFi and all functions has been

perfectly well and my phone has been gently used generally and for sure from update

to iOS7. WiFi started to loose connection to networks and refresh the list all the time

then it got greyed out, came back for a short while then permanently beeing greyed

out. Freezing the phone to make it work is a clear sign of HW failure. The fact that

a lot of people experience the same problem shortly after iOS update on totally

different ages of phones is also clearly pointing out iOS bug as the cause. Why does

it take different time from update to malfunction, well, circuits are different, usage is

different, for example in how warm environment is it used. Was phone used as GPS

while charging and lots of apps running in a hot car, the phone most likely was

extremly much warmer then a phone used minimally.

 

APPLE!!! Take care of this! We know you make huge margins and they must be

used to sponsor misstakes that are caused by YOUR misstakes. Believe me I know

my homework, I'm working in electronics business with embedded development and

HW manufacturing and testing."

 

The report also included a link to an AppleInsider report titled "iOS 7 update brings more Wi-Fi issues for some iPhone 4S owners."

 

The Class Action is divided into two distinct classes as follows:

 

GENERAL CLASS: All users who experienced loss or reduced functionality of their iPhone as a result of upgrading iOS.

 

SUBCLASS: All users of Apple iPhone 4s in the United States who experienced a loss of Wi-Fi and/or Bluetooth functionality after downloading iOS 7 (the "Class").

 

The Five Formal Counts Filed Against Apple

 

COUNT I: Violations of the Consumers Legal Remedies Act California Civil Code §1750, et seq.

COUNT II: Violation of California's Unfair Competition Law California Business and Professions Code §17200, et seq.

COUNT III: Breach of Express Warranty

COUNT IV: Intentional Misrepresentation

COUNT V: Negligent Misrepresentation

 

The patent infringement case presented in today's report was filed in the California Northern District Court, San Jose Office. At present, no Judge has been assigned to the case. The Nature of the Suit is noted as "Other fraud."

 

Patently Apple presents only a brief summary of certain legal cases/ lawsuits which are part of the public record for journalistic news purposes. Readers are cautioned that Patently Apple does not offer an opinion on the merit of the case and strictly presents the allegations made in said legal cases / lawsuits. A lawyer should be consulted for any further details or analysis. About Comments: Patently Apple reserves the right to post, dismiss or edit comments.