Apple Accused of Misleading Customers Entitled to Repairs, Replacements

Roughly 16 months ago, news began to surface of a problem affecting iPhones that had recently been upgraded to the then-new iOS 9. Devices that had previously been repaired by third-party shops or centers suddenly began throwing “Error 53” messages and refusing to function normally. It was caused by repairs that replaced either the Home button or the associated cable. But because this wasn’t known to be a problem at the time, devices that had been repaired and worked flawlessly under previous iOS versions suddenly began failing when upgraded to the latest version of Apple’s operating system.

Apple initially attempted to argue that bricking its customers’ devices was for their own good, and done to keep Apple Pay and Touch ID secure, before relenting and publishing a version of iOS (9.2.1) that un-bricked devices previously wrecked by Error 53. But in Australia, where consumer protections are generally more robust than they are in the US, it’s facing a lawsuit based on allegedly misleading tactics communicated to Australian customers when they contacted the company to report a problem.

iPhone Error

The “Error 53” error started cropping up on iPhones when Apple updated them and broke previous third-party repairs.

The Guardian has reviewed case documents provided to it by an unknown source. In order to determine how Apple was handling the problem, the Australian Competition and Consumer Commission (ACCC) contacted all 13 Apple stores across the country. Investigators posed as consumers and told Apple that their devices had stopped working following having the screen replaced. The documents allege that:

In each call, Apple Australia represented to the ACCC caller that no Apple entity … was required to, or would, remedy the defective speaker at no cost under the [Australian consumer law] if the screen of the iPhone had been replaced by someone other than Apple Australia or an Apple-authorized service provider.

That’s a violation of Australian law, which requires companies to provide either a repair or replacement device in a situation like this. Apple is accused of refusing to look at or service defective devices, even in cases where the repairs performed by a third party were completely unrelated to the original Error 53 fault. No equivalent lawsuit appears to have been filed over the more recent ‘touch disease,’ issues that affected the iPhone 6 Plus, though Apple did agree to slash its typical refurbishment fee for an affected iPhone 6 from $ 519 to $ 228.95 (all prices in AUD, $ 228.95 AUD is $ 171 USD).

Apple’s rebuttal: You aren’t real customers, so it doesn’t count

Apple’s response to these court documents is remarkable. In response to allegations that the ACC’s sting found clear evidence the company broke Australian law, Apple is arguing that because the ACCC’s investigators weren’t real customers, it can’t be proven to have done anything wrong. Consumer law, according to the company, does not exist in “hypothetical circumstances.”

This is one of the more absurd justifications we’ve heard for corporate misbehavior when uncovered by a journalist or investigator posing as an everyday user. The entire point of conducting such investigations on the sly is to find out how a company treats its customers when they don’t know that you’re a journalist.

This is simple common sense. You don’t need a master’s degree in marketing to know that treating a self-identified journalist or consumer watchdog poorly could backfire on your company. And as someone who has occasionally made these kinds of phone calls to company customer service centers, or walked into stores to check out what employees would say about an issue, I can safely confirm that if you’re making that kind of phone call or visit, you get your story straight beforehand. In most cases, it’s a straightforward process. You show up, present the problem, and wait to see how the company responds.

Arguing that individuals who are given false information when they pose as ordinary customers shouldn’t have their experience count in court because they were calling in the same way ordinary customers would is disingenuous in the extreme. Apple claims that real customers would have received different information that informed them to their right to repair or replacement under Australian law, despite explicitly not providing that information at any of its 13 retail locations across the country.

The company did not detail how its “Geniuses” would have ascertained that the ‘fake’ customers were not real, nor why they would be under orders to lie to investigators, when doing so would be more likely to lead to this kind of lawsuit.

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