Apple Class Action: Upgrade Program Members Blocked from iPhone 7

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Apple Inc. has unfairly blocked members of its iPhone Upgrade Program from ordering the new iPhone 7, giving priority to consumers who were not subscribed to the program, a class action lawsuit alleges.

Apple’s iPhone Upgrade Program, which was introduced in 2015, purports to allow members to easily trade in their iPhones for a newer version each year as long as they paid a monthly payment.

“Apple promised iPhone Upgrade Program customers a new phone every single year,” the iPhone class action lawsuit states.

However, Apple has not lived up to its promise, according to plaintiff Emil Frank.

Frank describes himself as a loyal Apple customer who signed up for the iPhone Upgrade Program so that he could enjoy getting a new iPhone every 12 months.

According to the iPhone upgrade class action lawsuit, Apple announced that customers could begin ordering the iPhone 7 and iPhone 7 Plus starting at 12:01 a.m. Pacific Time on Friday, Sept. 9.

Frank claims he woke up at 2:45 a.m. New York time to pre-order an iPhone 7 but none were available in New York City.

According to the iPhone Upgrade Program class action lawsuit, Frank checked inventory at every Apple store in more than a dozen states, but none would allow him to order any of the new iPhone products that he was interested in ordering.

“At the same time he was being shut out, customers outside the program were snapping up 128 and 256 GB iPhone 7 Plus devices in Black and Jet Black,” the Apple class action lawsuit states. “Non-upgrade customers were able to place orders that guaranteed in-store pickup or promised to deliver as early as September 16 or shortly thereafter.”

According to the iPhone upgrade class action lawsuit, the earliest Frank would have been able to get a new iPhone through the iPhone Upgrade Program would have been November or December.

Unwilling to wait that long, he decided to purchase a new iPhone for around $950, but he says he will likely not receive the product until several weeks after it was made available to others.

“The consequences for iPhone Upgrade Program members are severe,” Frank alleges.

Despite Apple’s promise that they could get a new iPhone every year, members of the iPhone Program will now have to wait to receive the devices they wanted. This delay defeats the entire purpose of the program, which attracts consumers who are willing to pay to have quick access to the latest iPhone technology, the lawsuit claims.

Frank notes the ripple effect this shut out will have on iPhone Upgrade members. If they receive their iPhone device several weeks (or months) after their release, they may effectively be barred from receiving a quick upgrade if Apple releases a new product in September 2017, as they are expected to do.

Frank’s iPhone class action lawsuit asserts claims for breach of contract, breach of the covenant of good faith and fair dealing, unjust enrichment, violations of California’s Consumer Legal Remedies Act and Unfair Competition Law.

Class Members of the proposed iPhone class action lawsuit include anyone who joined the Apple iPhone Upgrade Program before September 2016, made 12 monthly payments under the Program (or who are willing to fulfill their obligation to make the payments), and who have been unable to reserve or obtain a new iPhone 7 or iPhone 7 Plus.

Frank is represented by Whitney E. Street, Jason M. Leviton, Jacob A. Walker, and Joel A. Fleming of Block & Leviton LLP.

The Apple iPhone Upgrade Program Class Action Lawsuit is Emil Frank v. Apple Inc., Case No. 5:16-cv-05217, in the U.S. District Court for the Northern District of California.