Apple, AT&T Mobility Win Approval of Data Plan Suit Settlement

Apple Inc. (AAPL) and AT&T Mobility LLC won court approval to settle a lawsuit claiming the companies promoted and then quickly discontinued an unlimited data plan for customers who purchased an iPad 3G.

U.S. District Judge Ronald M. Whyte in San Jose, California, gave his preliminary approval yesterday to the agreement in which Apple will pay $40 cash to customers who submit a valid claim, according to a court filing. AT&T Mobility, a unit of Dallas-based AT&T Inc. (T), will give some class members a $20-a-month discount for one year for a 5GB iPad 3G data plan, according to the filing.

The agreement is “fair, reasonable, and adequate,” Whyte wrote in his order. Lawyers for the companies and plaintiffs must return to court for a Feb. 7 final approval hearing, he said.

The lawsuit consolidated four cases filed in 2010 with similar claims that the abrupt discontinuation of the “flexible access” data plan after an initial wave of iPad 3G purchases caused customers to overpay for the devices, and amounted to misrepresentation. AT&T, the largest U.S. phone company, had exclusive rights to the iPhone until 2011.

Kristin Huguet, a spokeswoman for Cupertino, California-based Apple, didn’t immediately return an e-mail seeking comment on the settlement.

The case is In Re Apple and AT&T iPad Unlimited Data Plan Litigation, 10-cv-02553, U.S. District Court, Northern District of California (San Jose).

To contact the reporter on this story: Joel Rosenblatt in San Francisco at jrosenblatt@bloomberg.net

To contact the editor responsible for this story: Michael Hytha at mhytha@bloomberg.

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