Apple Sued For iTunes Gift Card Fraud - InformationWeek

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6/24/2009
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Apple Sued For iTunes Gift Card Fraud

Illinois plaintiffs seek a refund for songs purchased for $1.29 while using Apple's $.99 iTunes gift cards.

Apple Inc. on Wednesday was sued for fraud, breach of contract, and violations of Illinois consumer protection laws by attorneys representing two residents of the state.

The plaintiffs, Daniel E. Owens and Barbara S. Owens, allege that Apple's iTunes Gift Cards promised song downloads for $0.99 and that the company's decision to raise song prices on April 7 to $1.29 turned the company's marketing message into misrepresentation.

The plaintiffs "seek a $0.30 refund for any song that has been purchased for $1.29 while using a 99 iTunes Gift Card," the complaint states. They also are seeking class certification, in order to represent the estimated tens of thousands of other iTunes Gift Card users in a similar situation.

If a judge certifies the suit as a class action, the amount involved would exceed $5 million.

Apple, the complaint states, "knowingly and fraudulently misrepresented, concealed, omitted, and/or suppressed the cost to purchase individual songs from its iTunes Internet Web site. As a result, Plaintiffs and members of the putative class have suffered economic harm in that they have paid monies for a product that was worth less than what was represented and/or they have been denied the benefit of their bargain to purchase any song from Defendant's iTunes Store for $0.99."

Apple did not respond to a request for comment.

There's some irony in the fraud charge given that Apple recently has stepped up its effort to fight iTunes Gift Card fraud. A recent PC World report claims that Apple has been disabling iTunes accounts of individuals who purchased iTunes Gift Cards at discount prices on eBay.


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