DEPARTMENT OF COMMERCE AND CONSUMER AFFAIRS

OFFICE OF CONSUMER PROTECTION

DAVID Y. IGE GOVERNOR

CATHERINE P. AWAKUNI COLÓN DIRECTOR

STEPHEN H. LEVINS EXECUTIVE DIRECTOR, OFFICE OF CONSUMER PROTECTION

FOR IMMEDIATE RELEASE November 18, 2020

Office of Consumer Protection Announces $113M Settlement with Apple Over iPhone Throttling

HONOLULU — The state Department of Commerce and Consumer Affairs Office of Consumer Protection (OCP), along with a coalition of over 30 other state attorneys general, announced a $113 million settlement with Apple, Inc. regarding Apple’s 2016 decision to throttle consumers’ iPhone speeds in order to address unexpected shutdowns in some iPhones.

Based on the multistate investigation, the states allege that Apple discovered that battery issues were leading to unexpected shutdowns in iPhones. Rather than disclosing these issues or replacing batteries, however, Apple concealed the issues from consumers.  Apple’s concealment ultimately led to a software update in December 2016 that reduced iPhone performance in an effort to keep the phones from unexpectedly shutting down.

The states allege that Apple’s concealment of the battery issues and decision to throttle the performance of consumers’ iPhones led to Apple profiting from selling additional iPhones to consumers whose phone performance Apple had slowed.

“This settlement holds Apple accountable for concealing its efforts to deliberately slow down iPhones. Its lack of transparency led people to mistakenly believe that there were problems with their phones that didn’t exist,” said OCP Executive Director Stephen Levins. “Apple’s conduct prevented people from opting for an easy fix, replacing the battery. Instead, Apple was able to profit from its conduct by causing users to purchase new phones even though their existing phones were working fine.”

Under the settlement, Apple will pay Hawaii more than $1.3 million. In addition to the monetary payment, Apple also must provide truthful information to consumers about iPhone battery health, performance, and power management. Apple must provide this important information in various forms on its website, in update installation notes, and in the iPhone user interface itself. Apple recently also entered into a proposed settlement of class action litigation related to the same conduct, and under that proposed settlement Apple will pay out up to $500 million in consumer restitution.

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Media Contact: Jayson Horiuchi Communications Officer Department of Commerce and Consumer Affairs Email: [email protected] Phone: (808) 586-7582