Apple Sued Over New IPhone Reception Problems by Consumers

Apple Inc. was sued over reception problems with its new iPhone 4 by consumers who accused the company of unfair business practices and false and misleading advertising.

A New Jersey resident and a Massachusetts resident who had bought the new mobile phone filed separate complaints yesterday in federal court in San Francisco, each seeking to represent other iPhone buyers in a class-action, or group, lawsuit. A separate complaint was filed this morning in Maryland, alleging Apple and wireless carrier AT&T Inc. were negligent in marketing the phone.

The June 24 introduction of the iPhone 4 was marred by criticism that signal strength diminishes when users cover the bottom left corner of the phone with their palm. The iPhone, which debuted in 2007, has become Apple’s top-selling product even after users reported glitches and dropped calls with previous versions of the device.

“Apple’s sale of the iPhone with this unannounced defect, assuming Apple’s prior knowledge of the defect, constitutes misrepresentation and fraud,” Christopher Dydyk of Cambridge, Massachusetts, said in his complaint. “In omitting to disclose the defect in the iPhone 4, Apple perpetrated a massive fraud upon hundreds of thousands of unsuspecting customers.”

Bumper Solution

Apple, which sold more than 1.7 million of the new phones in its first three days, has recommended users hold the phone differently or use a case to solve the problem. Apple is selling its own iPhone 4 cases in six colors for $29 each. They’re made of a piece of rubber known as a “bumper,” which surrounds the outer rim of the phone.

Dydyk, in his complaint, asked that Apple ship a bumper for free to customers who pre-ordered an iPhone 4 before its release or that the company be ordered to pay for customers’ bumpers.

Natalie Harrison, a spokeswoman for Cupertino, California, based Apple, didn’t immediately return a call to her office or respond to an e-mailed request for comment after regular business hours.

Maryland residents Kevin McCaffrey and Linda Wrinn claim in their complaint that Apple and AT&T “actively suppressed and concealed the fact that the iPhone 4 could not be held in a manner consistent with the normal usage of wireless communication devices.” They seek unspecified damages and a jury trial.

The California cases are Alan Benvenisty v. Apple, 10-2885, and Christopher Dydyk v. Apple, 10-2897, U.S. District Court, Northern District of California (San Francisco). The Maryland case is Kevin McCaffrey and Linda Wrinn v. Apple Inc. and AT&T INC., U.S. District Court, District of Maryland (Baltimore).

To contact the reporter on this story: Edvard Pettersson in Los Angeles at epettersson@bloomberg.net.

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