Apple and AT&T sued by 20 million plaintiffs

It doesn’t seem likely Apple will be selling unlocked iPhones any time soon. But in theory at least, a court ruling has brought that a step closer.

A federal court has granted class action status to a case against both Apple and AT&T. Class action means that anyone in a designated category (in this case, buyers of an iPhone with a two-year AT&T deal since 2007, an estimated 20 million people) can be covered by a single case. In many cases, everyone in the category is automatically considered a co-claimant unless they specifically opt out.

As a result of the ruling, the class action status will cover two claims that the companies breached competition laws:

• that Apple unlawfully prevents iPhone users from installing their own applications; and
• that Apple made a secret five-year exclusivity deal with AT&T, thus meaning customers on a two-year service agreement were effectively locked-in to AT&T as a provider for those five years if they wanted to continue using the phone.

The court rejected other claims such that Apple broke the law when iPhone operating system updates wiped out some apps or cause phones to freeze up.

Court rulings are, of course, always difficult to predict. Still, I’d be very surprised to see this one lead to anything. Whether or not you like Apple’s restrictive policies, they are hardly a secret, and even though people might not approve of the way the iPhone works, nobody is forced to buy one.

While it’s certainly possible some buyers didn’t understand that the phone was locked to AT&T or that apps were under Apple control, it seems unlikely that those bringing the case will be able to prove this was such a widespread situation as to justify a ruling against the companies in a class action situation.