On Monday, Judge Edward J. Davila issued a mixed ruling on Apple Inc.’s motion to dismiss a case arguing that the iPhone possesses software that permits the device to “secretly consume cellular data” for the company’s benefit.
The opinion explained that the plaintiff purchased an iPhone from a Verizon retailer in 2018, and in 2019, updated his iPhone with the iOS version 13 software. Apple reportedly promised that the update would improve iPhone functionality and make it faster.
The plaintiff claimed that contrary to that assertion, the update actually activated the phone’s data stealing capabilities. Specifically, it caused iPhones to “send significant amounts of data to Apple, routed Apple’s data transfers exclusively over cellular networks, and exempted Apple’s data transfers from normal settings favoring Wi-Fi connections.” The complaint said that Apple concealed this by falsely suggesting that users caused data consumption by uninstalling applications.
As previously reported, the plaintiff, a Washington resident, sued in October 2020 on behalf of himself and a putative class who pay for monthly data plans with certain caps. He alleged claims under the Consumers Legal Remedies Act (CLRA), the California Unfair Competition Law (UCL), the California Computer Data Access and Fraud Act (CDAFA), and trespass to chattels.
In this week’s opinion, Judge Davila overrode Apple’s challenge to the plaintiff’s injunctive relief and restitution claims. Specifically, the defendant argued that the consumer failed to allege that he lacked an adequate remedy at law. The court reasoned that legal remedies alone are inadequate because in theory, Apple “could again reintroduce software that ‘triggered’ the embedded ability to misappropriate user data for Defendant’s benefit,” necessitating an injunction.
As to restitution, the court found that legal damages alone would not cover the full value of the harm alleged. In particular, the court said that though damages may address situations in which a plaintiff exceeds his data plan and must pay an overage, they do not address the harm experienced by individuals who did not exceed their data plan, but whose data was consumed by Apple.
The court dismissed the plaintiff’s injunctive relief claim under the CLRA because the plaintiff never stopped using his iPhone and has continued to update it with new versions of iOS. “[T]he past harm must somehow impact the plaintiff’s future use of the product,” the court explained in denying leave to amend that claim. In addition, the court sided with Apple as to the plaintiff’s fraud-based claims after finding that he failed to plead reliance.
Finally, the court permitted the consumer’s trespass to chattels claim to proceed. Judge Davila determined that Apple’s interference with the plaintiff’s iPhone was significant enough to be actionable. “For example, Defendant’s conduct caused Plaintiff and the putative class members to incur cellular data charges, suffer from reduced iPhone data speeds, and lose cellular data that they purchased,” the opinion said.
The plaintiff has until March 10 to amend his complaint. He is represented by Gibbs Law Group and Tousley Brain Stephens PLLC and Apple by Morrison & Foerster LLP.
