Federal Judge Denies Class Certification in iTunes Lawsuit

An iTunes class action lawsuit filed against Apple, Inc. alleging that the tech giant charged customers twice for the same songs was denied class certification by a California federal judge, who said it would be difficult to figure out whether or not each iTunes customer meant to purchase the song twice or not.

The iTunes class action lawsuit was filed by Plaintiffs Robert Herskowitz and Phoebe Juel who both claim that “Apple, Inc. routinely and unlawfully charges its ‘e-Store’ customers more than once for the same products in violation of the consumer agreements governing those transactions and state law.”

The class certification was denied by U.S. District Judge Lucy Koh of the U.S. District Court in the Northern District of California, San Jose Division on Aug. 7.

Prior to October 2011, when Apple introduced the Cloud, customers could purchase items “only once, though once downloaded, purchases could be used on up to five authorized devices. Customers were therefore charged again for every download of a previously purchased product.”

Once “iTunes in the Cloud” was introduced in October 2011, customers could “download for free all previously purchased products, with limited exceptions.”

However Apple did provide refunds or a replacement if there was an unreasonable delay in the delivery of the product, prior to October 2011.

Also, during that period, Apple also “had a number of technical mechanisms in place to prevent double billing errors” because it was possible for customers to be “charged again for products that they had previously purchased.”

“Most significantly for present purposes, when a customer clicked ‘buy’ to purchase a product, the iTunes system was supposed to check if that customer had previously purchased the same product,” Judge Koh explained.

“If the customer had previously purchased the product, a warning ‘pop-up’ was supposed to appear informing the customer that she had already purchased the product,” she added.

Herskowitz claims that on Oct. 26, 2010 she purchased and downloaded a song by singer Adam Lambert. However, on Dec. 2, 2010 she claims that she was charged twice for the song. When she “reported the double-billing to Apple,” she claims that she was told by Apple that it “would not refund the second charge, stating: ‘Your request for a refund for ‘Whataya Want from Me’ was carefully considered; however, according to the iTunes Store Terms of Sale, all purchases made on the iTunes Store are ineligible for a refund.'”

Apple says that according to its records, that Herskowitz purchased and downloaded the song twice, but she “disputes these claims.”

Juel purchased a song by the band Barenaked Ladies, but she claims that even though the song had begun to download at the time of purchase, it never showed up in her iTunes library. She then clicked “buy” agains, three minutes later. At that point, the song did appear in her library. She was allegedly charged for both purchases and did not receive a refund.

She did not contact iTunes after the first purchased failed to download for a refund.

Herskowitz and Juel allege that this is common, and that  “Apple’s system ‘frequently commences and internally reflects ‘download’ of a purchased product, but fails to deliver the product to the customer so that the product does not appear in the customer’s library.'”

The plaintiffs also claim in their class action lawsuit that Apple “is aware of this issue — including the fact that customers typically re-click ‘buy’ — but that Apple’s system nevertheless bills customers twice to receive a single ‘usable’ copy of the product.'”

However, Koh said that there will be too many individual issues for a class action lawsuit to make sense.

“A class member who clicked buy once and received one download, but was charged twice, applied for a refund, and was denied a refund, likely suffered a different harm than a class member who clicked buy twice, saw the warning pop-up, confirmed the second purchase, received two downloads, and did not apply for a refund,” she wrote.

Juel and Herskowitz wanted three classes that they explained in the motion for class certification they filed in February. The Fifteen-Minute Class would have been for those who purchases a digital product from Apple and were charged for a second download within 15 minutes of the first. The Unusable Product Class was for anyone who bought an Apple digital product and was charged for the product but never received the product and had to purchase and pay for the product again before receiving it. The Active e-Stores Account Class was for those who would be members of the both of the other two classes as well as have an active e-Stores Account.

The California federal judge said that the problem with this scenario is that the court would have to go through each class member, case-by-case, to figure out if the class member had intended to buy the product twice and if the product was “unusable,” concluding that the classes did meet the necessary predominance requirement.

Koh also said that Apple does have a way of giving refunds to customers, and so the assertion that it violated the Consumer Legal Remedies Act does not stand and the lawsuits do not qualify as class actions.

The plaintiffs are represented by Christopher T. Heffelfinger, Anthony D. Phillips and Joseph J. Tabacco Jr. of Berman DeValerio.

Apple is represented by Penelope A. Preovolos, Tiffany Cheung and Suzanna P. Brickman of Morrison & Foerster LLP.

The iTunes Class Action Lawsuits are Herskowitz et al. v. Apple Inc., Case No. 5:12-cv-02131, and Juel et al. v. Apple Inc., Case No. 5:12-cv-03124, in the U.S. District Court for the Northern District of California.