Apple, Best Buy Reach Deactivated iTunes Gift Card Class Action Settlement

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Apple Inc. and Best Buy Co. Inc. have agreed to settle a proposed class action lawsuit over allegations Best Buy deactivated unused Apple iTunes gift cards without informing consumers about the expiration dates. Under the terms of the proposed class action settlement, all Class Members will receive full recovery of the face value of the deactivated iTunes gift cards.

The class action lawsuit, filed in October 2012 by plaintiff Barbara Farfard, alleged that certain iTunes gift cards purchased from Best Buy stores between September 2007 and December 2009 were deactivated before the gift card holders redeemed them. Farfard claimed that neither Apple nor Best Buy informed consumers that the iTunes gift cards would expire, and that the gift cards did not display an expiration date.

The deactivated iTunes gift card lawsuit asserted claims of breach of contract, breach of the implied covenant of good faith and fair dealing, unjust enrichment, conversion, and violations of the California Unfair Competition Law and the Consumer Legal Remedies Act.

The defendants denied liability but agreed to settle the class action lawsuit to avoid the expense and uncertainty of trial.

Under the terms of the proposed iTunes gift card class action settlement, Class Members include all U.S. residents who currently have iTunes gift cards that were purchased from Best Buy stores between Sept. 1, 2007 and Dec. 31, 2009 and deactivated between Aug. 1 and Aug. 31, 2010 and have not been redeemed by the cardholder.

It is estimated that more than 287,000 iTunes gift cards were deactivated during the Class Period. “Defendants possess no information that permits direct identification of the individual gift card holder for the majority of affected gift cards, and are thus unable to ascertain the precise number of individuals holding deactivated cards,” the motion says.

Some iTunes gift card holders have already received replacement gift cards, and deactivated iTunes gift cards have already been reactivated. Under the terms of the class action settlement, holders of identified gift cards will have their iTunes accounts credited with the full face value of the gift card. Further, individuals who have a receipt reflecting the purchase of a deactivated iTunes gift card from a Best Buy store between Sept. 1, 2007 and Dec. 31, 2009, but who cannot locate the original PIN from the gift card will be given a replacement PIN after the claim has been reviewed.

“That full relief is available to Class Members demonstrates that the settlement is fair, reasonable, and adequate,” Farfard said in her motion supporting preliminary approval of the class action settlement.

A hearing for preliminary approval of the proposed deactivated iTunes gift card settlement has been set for April 3, 2014. More information about how to file a claim for the iTunes gift card class action settlement was not immediately available. Keep checking TopClassActions.com or sign up for our free newsletter for the latest updates. You can also mark this article as a “Favorite” using your free Top Class Actions account to receive notifications when this article is updated.

Farfard is represented by Jonathan Auerbach, Jerome M. Marcus and Steven G. Tyson of Marcus & Auerbach LLC and William A. Kershaw and Stuart C. Talley of Kershaw Cutter & Ratinoff LLP.

The Deactivated iTunes Gift Card Class Action Lawsuit is Barbara Farfard v. Apple Inc., et al., Case No. 3:12-cv-05125, in the U.S. District Court for the Northern District of California.