Apple loses appeal; fined $1.2m for 'misleading' AppleCare customers
Summary: Apple remains in hot water with the Italian antitrust authorities after it was found to be "misleading" customers on a one-year warranty, when consumers should have been given two.
Apple today lost its appeal in an Italian court, after it was found to have misled consumers into shelling out for AppleCare extended warranty when it was not necessary.
In December, Apple was fined €900,000 ($1.2m) by Italian antitrust authorities after it had failed to inform its customers of their legal consumer rights.
The fruit-named technology retailer said it would appeal. That appeal fell through and Apple walks away with a meagre fine and a slap on the wrist.
Under Italian law, products bought are given two years warranty by default. But Apple knowingly provided a one-year warranty for its Macs and iOS devices, including iPhones and iPads, whilst pushing its additional year of extended warranty in form of a premium service.
Apple added disclosures to its Italian online store as per the first court's order, after the company was found not to have adequately informed its customers of their legal right.
The news comes hot off the heels of 11 European consumer groups complaining that AppleCare warranties violate EU law. A formal notice was issued by the European Consumers' Organisation requesting the company no longer sells products with a one-year warranty.
The minimum warranty for products sold in the EU is two years. Apple's stance on one-year warranties, as it pedals its extended warranty service, could ultimately be found to be breaking European law.
If that's the case and an antitrust inquiry is started, the company could face a fine of up to 10 percent of its global annual turnover. Seeing as the company recently closed at the $600 a share mark, Apple could face a fine of around $10--12 billion.
I bet it's wishing it held onto a bit more of its cash reserve now; just in case it gets sued or fined.
Image source: Apple.
Related:
- News to know: Italy fines Apple, Sweary Siri, New Year cell service
- Between the Lines: Apple's cash plans: Pay dividend, $10 billion share buyback
- CNET: Apple stock finishes above $600 for first time
- iPhone 4S to launch in Italy without Samsung ban
- Italy fines Apple $1.2 million over AppleCare practices
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Talkback
This is excellent news
Shame on Apple for this behavior. I'm only sorry that $1.2 million is about 12 hours of interest if Apple's cash stockpile was earning 1% a year. This is no incentive for Apple to change anything.
You are missing the "ouch"
One outcome of an investigation of this type could result in a fine of 10% of global sales (about 10-12 billion $$$$).
That, would hurt.
The question is...
Oh no, Toddy-fauty would
It is amazing how the EU seems to think it should have special priv over the US. First making MS have to give an option upfront to users to select a different browser, and now having an extended warranty on electronics? WOW!!
@T-Wrench
If that's what they are required to do to sell their product there, they know that going in.
Just sayin.
Hmm
Hmm
Lets settle for 1% and get it over with quick.
So, there is a mandatory 2 year minimum warranty on bread, tomatoes, etc.
Ever think that there's a difference between durable goods and perishable
Food and hardware/appliances, would come under different laws for protection of the citizenry.
$1.2 million? LOL!!!!
Well then good.... Every organization once it grows too big
Pagan jim
I realize I'm a day late
"The minimum warranty for products sold in the EU is two years. Apple???s stance on one-year warranties, as it pedals its extended warranty service"
Whatever...
Yeah. Whatever...
As for the deaths? These factories employ and house hundreds of thousands of workers. They are literally cities in their own right. Like anyone anywhere moving from a "bare-hut", agrarian rural environment to a heavily urbanized one, I am sure there's a good level of culture shock -- even when relocating like that within THEIR OWN COUNTRY (which, of course, is gigantic). Despite that, despite the hundreds of thousands of workers, the suicide rate at these factories IS BELOW China's national average.
Inaccurate complaints such as yours are getting quite tiring.
huh?
Really!?
http://www.Lmgtfy.com/?q=foxconn+number+of+workers
Of particular note:
Foxconn's largest factory worldwide is in Longhua, Shenzhen, where hundreds of thousands of workers (varying counts include 230,000, 300,000, and 450,000) are employed at the Longhua Science & Technology Park, a walled campus sometimes referred to as "Foxconn City" or "iPod City". Covering about 1.16 square miles (3 square km) it includes 15 factories, worker dormitories, a swimming pool, a fire brigade, its own television network (Foxconn TV) and a downtown complete with a grocery store, bank, restaurants, bookstore, and hospital. While some workers live in surrounding towns and villages, others live and work inside the complex; a quarter of the employees live in the dormitories, and many of them work 12-hour days for 6 days each week.
Before that last line gets you all worked up. This is for a single plant. FoxConn has over a dozen in China. They also have other factories in other countries, including Brazil, Malaysia, India, Mexico, and Europe.
You couldn't find this out yourself?!?
Why can't people appreciate that smarter people know what's good for them?
I try not to stereotype people based on mundane things like their tech preferences and was at first dismissive of the elitism charges as sour grapes by jealous fans of other companies. And I still think the average purchaser of Apple products are not elitist and I don't hate people because they are wealthy. But I'm sorry that particular company has a large hard core following that are elitist. I can't think of a better post that defines it then the one above.
The facts the poster presented are not wrong it is the posters belief that it is ok. Apple and all of these companies that became rich because of America and then went going overseas and destroyed the US labor market are moral traitors. Back in the olden times US companies going overseas made it their point to help the locals. The US got a nice little empire out of it and companies created PROFITABLE new markets for themselves. The empire is still here but it is being held together by economic band aids and mercenary armies.
"killing" and lies for profit....
Daisey told exactly the kind of "socially conscious" lies many people love to hear these days - "corporations and capitalism are EVIL!" - and his credulous NPR-type audience ate it up.
Start here: http://www.nytimes.com/2012/03/19/business/media/theater-disguised-up-as-real-journalism.html
Liar