Jan 3, 2018 | Consumer Protection, Employment & Technology Archive
Urban Outfitters Overtime Lawsuit – Plaintiff Department Manager Allegedly Misclassified as Exempt Under Federal Overtime Laws
On December 27, 2017, an overtime lawsuit was filed in United States District Court, Eastern District of Virginia, Norfolk Division, by Plaintiff Joshua Allison for misclassifying him as exempt under federal overtime laws and failing to pay Plaintiff for all hours worked, as well as overtime pay for hours worked beyond 40 in a workweek.
The Plaintiff, according to the complaint, served as a Department Manager for Urban Outfitters from approximately July 2012 until April 2013 in Norfolk Virginia and in Savannah, Georgia from April 2013 until October 2013.
Urban Outfitters Overtime Lawsuit – Overtime Lawsuit Allegations
The Plaintiff in the Urban Outfitters overtime lawsuit alleges that he is entitled to 1) unpaid wages from Urban Outfitters for all hours he worked, as well as for overtime worked for which he did not receive premium pay; and 2) liquidated damages pursuant to the Fair Labor Standards Act (“FLSA”).
Urban Outfitters Overtime Lawsuit – Overtime Lawsuit’s Statement of Facts
According to the complaint:
As a Department Manager, Plaintiff’s work was performed in the normal course of Urban Outfitters’ business and was integrated into it.
Plaintiff regularly worked in excess of forty hours per workweek without receiving overtime compensation.
Defendant scheduled Plaintiff to work 40 hours per week, but Plaintiff worked an average of approximately 55-65 hours per week during each week in which he worked five or more shifts.
Urban Outfitters assigned all of the work that Plaintiff performed or was aware of it.
Plaintiff’s work required little skill or capital investment and did not include the exercise of meaningful independent judgment and discretion.
Urban Outfitters Overtime Lawsuit – “Subordinate” Department Managers
According to the Urban Outfitters overtime lawsuit complaint, Urban Outfitters’ Form 10-K for the fiscal year ended January 31, 2016, “all but admits that [Urban Outfitters’] stores are run by their store managers, and the Department Manager position is treated as a subordinate one, on the level of staff.”
According to the complaint, Urban Outfitters’ Form 10-K states the following:
We have organized our retail store operations by brand into geographic areas or districts that each have a district manager. District managers are responsible for several stores and monitor and supervise individual store managers. Each store manager is responsible for overseeing the daily operations of one of our stores. In addition to a store manager, the staff of a typical store includes a combination of some or all of the following positions: a visual manager, several department managers and full and part-time sales and visual staff.
Urban Outfitters Overtime Lawsuit – Plaintiff’s Duties as an Urban Outfitters’ Department Manager
According to the overtime lawsuit complaint:
The Plaintiff’s primary duties as a Department Manager included manual labor (e.g., cleaning the store, folding clothes, building displays, unloading freight). The Plaintiff’s job duties did not include supervisory tasks such as hiring, firing, disciplining or exercising meaningful independent judgment and discretion.
Urban Outfitters, pursuant to a centralized, company-wide policy, pattern and/or practice, classified the Plaintiff and all Department Managers as exempt from the overtime provisions of the FLSA.
Urban Outfitters, as part of its regular business practice, intentionally, willfully, and repeatedly engaged in a policy, pattern, and/or practice of violating the FLSA with respect to Plaintiff, a policy and pattern or practice which, according to the complaint, included, but was not limited to, willfully misclassifying Plaintiff as exempt from the overtime requirements of the FLSA; and willfully failing to pay Plaintiff overtime wages for hours worked in excess of 40 hours per workweek.
Further, as it pertains to the named Plaintiff, Urban Outfitters failed to maintain accurate and sufficient time records; had a policy and/or practice that only allowed the Plaintiff to report a maximum of 40 hours worked per week.
Urban Outfitters Overtime Lawsuit – FLSA Violations
According to the Urban Outfitters overtime lawsuit complaint, the Plaintiff seeks, among other things, an award of unpaid wages for all hours worked in excess of 40 hours in a workweek at a rate of one and one-half times the regular rate of pay due under the FLSA, as well as an award of liquidated and/or punitive damages as a result of Urban Outfitters’ willful failure to pay for all hours worked in excess of 40 in a workweek at a rate of time and one-half the regular rate of pay.
Image: “Urban Outfitters, Belfast, June 2010,” Ardfern (Own Work), CC BY-SA 3.0
Urban Outfitters Department Managers
If you served as a Department Manager for Urban Outfitters and wish to discuss whether you may have legal claims with an attorney, please complete the form above on the right or contact Michael Yarnoff, Esq., (215) 792-6676, Ext. 804, [email protected], or send an e-mail to [email protected].
Jan 2, 2018 | Consumer Protection, Employment & Technology Archive
Goodyear G159 Motor Home Tires – National Highway Traffic Safety Administration Probe
NHTSA Investigation to Determine Whether Some Older Goodyear Motor Home Tires Can Fail and Cause Accidents or Deaths
On January 2, 2017, The New York Times reported a story (“Regulators Open Probe of Goodyear Motor Home Tires Failures”) which stated:
U.S. safety regulators are investigating whether some older Goodyear motor home tires can fail and cause crashes and possibly deaths.
The National Highway Traffic Safety Administration says it began the probe after a court ordered the release of Goodyear data from lawsuits, which had been sealed under court orders and confidential settlement agreements.
According to the data, the G159 tires failed while in use, resulting in deaths and injuries. The agency says in documents posted Jan. 1 that the number of claims suggests the failures could be caused by a safety defect. Goodyear wasn’t required to report many of the claims to NHTSA under federal law.
Goodyear G159 Motor Home Tires – 40,000 Tires from 1996-2003
According to the aforementioned news article:
The investigation covers about 40,000 tires from 1996 to 2003.
The agency also received 10 complaints of tire failure, including two that caused crashes. The documents say Goodyear reported nine claims to the agency involving one death and 13 injuries. Some of those filing claims allege the G159 tires were not designed for extended highway use on motor homes.
Goodyear G159 Motor Home Tire Failures – “Finally Dragged Into the Public Eye”
Research disclosed a June 29, 2010 safetyresearch.net posting, “Goodyear G159 Tire Failures on RVs Finally Dragged Into the Public Eye,” which stated the following:
Goodyear’s G159 and a Class-A Motor Home was always a bad match. The tire was designed for urban delivery vehicles and speed-rated for only 65 mile per hour continuous use. Nonetheless, Goodyear had marketed the G159 to the RV industry for nearly a decade in the 1990s and 2000s, even though the tire design was prone to overheat on RVs that typically travel at greater speeds for extended periods. Goodyear knew it was dangerous for motor homes, but didn’t want [to] lose a market segment. So, in 1998, after speed limits increased nationwide, Goodyear bumped the speed rating of the G159 to 75 miles per hour.
By 1999, there had been two recalls and one Product Service Bulletin to replace G159 tires on RVs, but the recalls blamed inadequate load margin and customer misuse, and did not identify the tire design itself as defective. In fact, Goodyear has consistently assured the public that the tires are safe for all uses.
That claim was officially refuted . . . in a Pasco County, Florida Circuit Court, when the jury in Schalmo v. Goodyear handed the tiremaker 5.6 million reasons to stop insisting that a G159 was okay to install on an RV. The jury found that the Goodyear Tire & Rubber Company had sold a defective tire marketed to recreational motor home manufacturers, even though the tire was not suitable for RV use.
. . .
A failed Goodyear G159 was the cause of an August 11, 2004 crash that seriously injured the driver and two occupants. The tire was original equipment on a 2000 American Tradition motor home owned by John Schalmo of Port Richey, Florida. Schalmo was heading westbound on State Road 8 in Chipley, when the right-front tire of his motor home suffered a catastrophic tread separation. Schalmo lost control of the RV and veered off the right side of the roadway, heading out of control across an exit ramp and into a line of trees. Schalmo, and his wife’s parents William and Ruth McClintock, were seriously injured. William McClintock lost both legs as a result of the crash; he died of unrelated causes two years before the trial.
This was the first G159 tire case to be resolved in a public trial. Goodyear has quietly settled as many as a dozen G159 tread separation cases involving serious injuries and deaths, in exchange for confidentiality. The Schalmo and McClintock families refused to agree to a confidential settlement, and have expressed their hope that Goodyear will recall the tire.
. . .
In a 2006 Fleet Owner magazine feature, a Goodyear marketing communications manager acknowledged that the G159 was a truck tire that had not been developed for RVs. That same year, Goodyear stopped selling the G159 and replaced it with a more robust tire specifically designed for motor home use. But Goodyear has never recalled the all of the G159 tires already sold, and tens of thousands or perhaps more remain in the field.
Safety Issues & Recalls – Consumer Resource
Consumers can access the NHTSA’s “Safety Issues & Recalls” page to check VINs, vehicles, car seats, tires, and equipment by clicking here.
Dec 28, 2017 | Consumer Protection, Employment & Technology Archive
FTC Alleges Deceptive Claims in Get-Rich-Quick Scheme Whose Operators Claimed Consumers Could Earn Big Money Using “Automatic Money Systems” & “Secret Codes”
On December 28, 2017, the Federal Trade Commission announced that it charged the operators of a get-rich-quick scheme with deceiving consumers by falsely claiming they could earn big money working from home by using products marketed as “secret codes” that were actually generic software products.
FTC Files Complaint for Permanent Injunction & Other Equitable Relief
FTC v. RONNIE MONTANO, individually and as owner of MONTANO ENTERPRISES LLC; HYONG SU KIM, a/k/a JIMMY KIM, individually and as owner of JK MARKETING LLC; MARTIN SCHRANZ, individually and as owner and officer of GSD MASTER AG, MONTANO ENTERPRISES LLC, a New Jersey limited liability company; JK MARKETING LLC, a Nevada limited liability company; GSD MASTER AG, a Swiss limited company
Defendants Allegedly Bilked Consumers Out of Millions by Falsely Promising Consumers Could Earn Hundreds to Thousands of Dollars a Day
The FTC’s announcement states that the complaint, filed in United States District Court, Middle District of Florida, alleges that Ronnie Montano, Hyong Su Kim (also known as Jimmy Kim), Martin Schranz and their related companies bilked consumers out of millions of dollars by falsely promising they could earn hundreds to thousands of dollars a day using the defendants’ Mobile Money Code products. In reality, the Mobile Money Code products were generic software applications that could help the user make mobile-friendly websites.
FTC’s Complaint Alleges Defendants Contacted Consumers with Spam E-Mail
The complaint alleges that the defendants primarily contacted consumers with spam emails sent by affiliate marketers. For example, some emails cited in the complaint claimed that the products were a “secret method folks are using to make thousands of dollars per day (seriously!)” or that users can start “generating 60k a month on 100% autopilot.” The defendants allegedly sold their products through a variety of websites such as mobilemoneycode.com, automobilecode.com and secretmoneysystem.com.
Misleading Spam E-Mail Subject Headings, No Clear Way to Opt Out, False Testimonials & Failure to Honor “Money Back Guarantee”
In addition to the deceptive earnings claims, the defendants allegedly used misleading subject headings in the spam email they sent to consumers and failed to include a clear means to opt out of future messages. Consumers who went to the defendants’ websites were met with more deceptive claims, including online videos that featured individuals who claimed they made hundreds to thousands of dollars per day using the defendants’ products. In reality, these individuals were actors hired by the defendants to provide false testimonials.
Consumers who tried to exit the websites without purchasing a product were allegedly blocked with a series of pop-up messages. Even those consumers who agreed to make an initial purchase were asked to make additional purchases through upsells and add-ons, according to the complaint.
The FTC’s complaint also alleges that the defendants did not honor their “60-day hassle-free money back guarantee” and made it extremely difficult, if not impossible, to obtain a full or partial refund.
The FTC alleges that the defendants violated the FTC Act’s prohibition against deceptive practices and the CAN-SPAM Act, which requires that a commercial e-mail contain accurate header and subject lines, identify itself as an ad, include a valid physical address, and offer recipients a way to opt out of future messages.
The FTC’s complaint summarized the action against the Defendants as follows:
Since 2013, Defendants conducted a business opportunity scheme that established multiple affiliate marketing programs and used them to deceptively market a series of software products and upsell/add-on products and services (the “Mobile Money Code Products”) to consumers looking to make money from home. Defendants marketed the Mobile Money Code Products through a network of affiliates that primarily used unsolicited commercial email (spam) to attract consumers to Defendants’ marketing websites. Defendants (and their affiliates) deceptively marketed the Mobile Money Code Products as risk-free, “automatic money systems” and “secret codes” that could generate hundreds to thousands of dollars each day for users. Based upon such false representations, consumers typically paid Defendants for an initial product purchase and up-sell/add-on products and services, ranging from $49 to several hundred dollars. Only after receipt of the Mobile Money Code Products did some consumers realize that they had purchased generic software applications and commonplace information for creating mobile-friendly websites, and nothing akin to “automatic money systems” or “secret codes.” Defendants made false and unsubstantiated earnings claims, misrepresented the nature of the Mobile Money Code Products, and falsely promised a 60-day, hassle-free, money back guarantee, thereby defrauding consumers of not less than $7 million.
The FTC, according to the complaint, filed the case against the Defendants “. . . under Section 13(b) of the Federal Trade Commission Act (“FTC Act”), 15 U.S.C. §§ 53(b), and Section 7(a) of the Controlling the Assault of Non-Solicited Pornography and Marketing Act of 2003 (“CAN-SPAM Act”), 15 U.S.C.§ 7706(a), to obtain permanent injunctive relief, restitution, the refund of monies paid, disgorgement of ill-gotten monies, and other equitable relief for Defendants’ acts or practices in violation of Section 5(a) of the FTC Act, 15 U.S.C. § 45(a), and the CAN-SPAM Act, 15 U.S.C. §§ 7701-7713.”
Click here to view the FTC’s Consumer Information blog post regarding the alleged “get-rich-scheme.”
Dec 26, 2017 | Consumer Protection, Employment & Technology Archive
Apple iPhone Class Action Filed in the Northern District of California
iPhone Class Action Seeks Injunctive Relief & Damages Due to Apple’s Alleged Failure to Inform Consumers that iPhone 6, iPhone 6S, iPhone SE and iPhone 7 Updates to iOS 10.2.1 and/or iOS 11.2 Would Significantly and Artificially Reduce iPhone Performance.
iPhone Class Action Alleges Apple Failed to Inform Consumers that iPhone Performance Would be Restored by As Much As 70% With a Simple iPhone Lithium-Ion Battery Replacement Costing Less than $100 at an Apple Store.
Image: Pixabay, Andile Moyo (DTech), CC0 1.0 Universal
iPhone Class Action Alleges Apple Purposefully Failed to Disclose That iPhone Update Eroded iPhone Performance
According to an iPhone class action lawsuit filed on December 22, 2017 in United States District Court, Northern District of California, by Plaintiff Nicole Gallmann against Apple Inc.:
In the modern digital age, batteries “wear” over time. The lithium-ion battery used by Apple slowly diminishes its ability to hold a charge with time and use. However, normal lithium-ion battery wear does not reduce performance; a weakening battery has no effect on performance unless there is software that links the two. And that is precisely what Apple did.
In rolling out iOS 10.2.1, Apple claimed to “bug fixes and improve[ ] the security of [the] iPhone or iPad” and “improve[ ] power management during peak workloads to avoid unexpected shutdowns on the iPhone.”[] What Apple purposefully failed to disclose, however, was that the update would act as a latent time-bomb that slowly eroded the phone’s performance to the frustration of the user – the software update throttled the handset’s performance.
The effect of Apple’s actions was to a) purposefully reduce device performance with time, and b) deprive consumers of material information concerning the cause of the decline in performance of [iPhone 6, iPhone 6S, iPhone SE or iPhone 7 devices].
iPhone Class Action Allegations
According to the iPhone class action complaint filed by Plaintiff Gallman:
On January 23, 2017, Apple released iOS 10.2.1. The update specifically addressed aging batteries, and expressly represented that the purpose was to prolong the useful life of the Device. Apple promised to “deliver the best experience for customers, which includes overall performance and prolonging the life of their devices.”[]
For example, the update specifically sought to prevent the handset from shutting down if a performance spike drew too much power—i.e., turning off unexpectedly as if the [iPhone] was dead while the phone’s battery still had a charge. While the battery issue was a reported problem at the time,[] the iOS update did far more than address shutdowns on those few phones that experienced shutdowns – it also surreptitiously and purposefully throttled the performance speed on the iPhone 6, 6S, and SE’s by as much as 70 percent. [Emphasis added]
Furthermore, the update did not even fully address the purported battery “shutdown” issue on all devices: 20 percent of iPhone 6s and 30 percent of iPhone 6 devices that previously experienced unexpected shut down issues continued to experience those issues, according to a statement released by Apple.[] At the time the iPhone 7 was not impacted. However, it is now known that the feature at the center of the iOS 10.2.1 update was later extended to iPhone 7 with the release of iOS 11.2, and will be added to other products in the future. [Emphasis added]
Apple also informed consumers that for those who need it, a message will appear on the screen inside Settings if that phone’s “battery needs service.” Apple did this to “add a bit more transparency to people wondering when Apple considers the battery worn down enough to get swapped out.” Apple even offered consumers tips regarding when to swap out a battery.[]
However, despite all of these disclosure opportunities, Apple never informed consumers that the 10.2.1 update reduced unexpected phone shutdowns by slowing the device’s performance dramatically. [Emphasis added]
Moreover, consumers experiencing these issues were never notified by Apple (as it represented it would) that “the [device’s] battery needs service.” [Emphasis added]
Because Apple failed to informed consumers that the performance issues were artificially caused by the iOS update in conjunction with an older (but still perfectly functional) battery, consumers were denied the opportunity to make an informed decision regarding whether to upgrade their device or instead simply replace the battery. [Emphasis added]
Apple’s failure to disclose the impact of the iOS update 10.2.1 (and the later iOS 11.1) and remedy the issues it produced (and purported to resolve) constitutes an unfair trade practice and breach of the covenant of good faith and fair dealing implied in Apple’s contracts with Plaintiff and the class. Plaintiff and the class were harmed as a direct and proximate result of Apple’s actions.
One source referenced in the class action complaint was a Motherboard story by Jason Koebler, “Apple Throttles iPhones that Have Old Batteries (But Didn’t Tell You About It).” The article stated that
[w]hat makes it worse is that Apple does not make it easy to replace the battery yourself, discourages third party repair, and doesn’t have the first party repair infrastructure to handle large numbers of in-store battery swaps, especially in states that don’t have lots of Apple Stores.
. . .
The scandal here is not that Apple throttles your phone. It’s that it doesn’t tell you it throttles, and makes it hard for you to fix the problem (or for you to know about your repair options). The scandal is in the design of the iPhone itself, which requires proprietary tools to open and various components to be removed in order to replace the only part of the phone that is guaranteed to go bad. The scandal is that Apple actively discourages you from trying to fix your own phone, lobbies against legislation that would make it easy for you to restore your phone to peak condition. If you’re mad about this, you’re not crazy—you have every right to be.
iPhone Class Action – The iPhone Class
The class action was brought on behalf of the named Plaintiff and a proposed class of all consumers who reside in the United States and owned either iPhone 6, iPhone 6S, iPhone SE or iPhone 7 models purchased in the United States and upgraded to iOS 10.2.1, or a later version, prior to the date of the iPhone class action complaint (filed December 22, 2017).
If you own an iPhone 6, iPhone 6S, iPhone SE or iPhone 7 which was upgraded to iOS 10.2.1, or a later version, and have questions about your potential legal rights, please fill out the form on the right or send an e-mail to [email protected].
Dec 24, 2017 | Consumer Protection, Employment & Technology Archive
Apple iPhone Slowdown – Apple Inc. Sued by iPhone Owners
The Mercury News reported (“Two iPhone owners sue Apple over iPhone slowdown admission, seek class-action status”) that
Two iPhone owners based in Los Angeles sued Apple . . . a day after the Silicon Valley technology giant admitted it slows down older iPhones to prevent unexpected battery-related shutdowns.
Plaintiffs . . . filed the lawsuit in the Central District Court of California.
[The Plaintiffs] argue Apple installed a new feature to throttle old iPhones without the owners’ permission. They also allege it intentionally interfered with the phones to damage them, which became a “substantial factor in causing (iPhone owners) to replace iPhones, buy new batteries, or loss of usage of their iPhone.”
. . .
[The Plaintiffs] filed the lawsuit after Apple acknowledged . . . for the first time that [Apple] installed a feature last year for iPhone 6, [iPhone] 6S and [iPhone] SE models that have a degraded and aged battery, to prevent unexpected shutdowns. However, the feature lessened the computing power of the iPhones to stop overuse of battery power.
“Our goal is to deliver the best experience for customers, which includes overall performance and prolonging the life of their devices,” Apple said in a statement to multiple media outlets. “Last year we released a feature for iPhone 6, iPhone 6s and iPhone SE to smooth out the instantaneous peaks only when needed to prevent the device from unexpectedly shutting down during these conditions. We’ve now extended that feature to iPhone 7 with iOS 11.2, and plan to add support for other products in the future.”
The statement drew widespread reactions on social media. It also fanned speculation by some about whether Apple slows down old iPhones to pressure users to upgrade to a newer model.
[The Plaintiffs] allege Apple breached implied contracts with them and other iPhone owners by “purposefully slowing down older iPhone models when new models come out and by failing to properly disclose that” when they bought their iPhones.
The Plaintiffs, according to the story, “. . . argued that Apple never asked them for permission to install this feature and did not give them the option to choose or bargain a way to turn off the feature.”
Image: Pixabay, Attapon Thaphaengphan (attapontom), CC0 1.0 Universal
Apple iPhone Slowdown– Class Action Lawsuit Alleges Deceptive Trade Practices & False Advertising
On December 22, 2017, a class action lawsuit was filed in United States District Court, Southern District of New York, against Apple Inc. According to the class action complaint, the lawsuit was brought
[o]n behalf of owners of all versions of the iPhone 6 and/or iPhone 7 who were harmed when their devices’ software was updated to any of the following: iOS 10.2.1 (released on January 23, 2017); iOS 10.3 (released on March 27, 2017); iOS 10.3.1 (released on April 3, 2017); iOS 10.3.2 (released on May 15, 207); iOS 10.3.3 (released on July 19, 2017) . . . iOS 11.0.1 (released on September 26, 2017); iOS 11.0.2 (released on October 3, 2017); iOS 11.0.3 (released on October 11, 2017); iOS 11.1 (released on October 31, 2017); iOS 11.1.1 (released on November 9, 2017); iOS 11.1.2 (released on November 16, 2017); iOS 11.2 (released on December 2, 2017); and iOS 11.2.1 (released on December 13, 2017) . . .. [Emphasis added]
The class action complaint also alleges that
Defendant Apple Inc. . . . engaged in deceptive trade practices and false advertising in violation . . . when it represented that the iOS 10 and iOS 11 [u]pdates were compatible with and support iPhone 6s and iPhone 7s. Specifically, Apple failed to warn iPhone 6 and iPhone 7 owners that the iOS 10 and iOS 11 [u]pdates could significantly and negatively interfere with their phones’ performance. To the contrary, Apple specifically touted the increased phone performance that would result from the iOS 10 and iOS 11 updates. Apple has since admitted[,] however that, through the iOS 10 and iOS 11 [u]pdates, Apple deliberately prevents chips in iPhone 6s and iPhone 7s from reaching their full processing power. In other words, instead of enhancing the performance of iPhone 6s and iPhone 7s as Apple represented, the iOS 10 and iOS 11 [u]pdates were designed to limit the devices’ performance in certain circumstances.
Having updated their phones, Plaintiffs and owners of iPhone 6s and iPhone 7s must either continue using devices that experience significant lag time that interferes with their ordinary use, or purchase a new phone for hundreds of dollars. [Emphasis added]
Apple iPhone Slowdown – Apple Admits Slowing Down iPhone Devices
Newstalk.com reported (“Apple facing class action lawsuits after admitting to slowing down old iPhones”) that class actions allege that Apple “deceived customers by slowing down older phones.” Newstalk.com reported that
[e]arlier this week, the company admitted slowing down outdated iPhone devices with low-capacity batteries, saying it is a way of protecting the devices’ components.
The first lawsuit was filed in California and requests that Apple stop reducing the processor speed of affected devices and pay compensation to affected customers.
The Chicago Sun Times reported another case in which citizens in Ohio, Indiana, and North Carolina are suing Apple on behalf of customers who own iPhone 5, [iPhone] 6 and [iPhone] 7 devices.
The complainants allege that Apple was “deceptive, immoral, and unethical” because the technology was designed to “purposefully slow down or ‘throttle down’ the performance speeds” of the iPhones.
Apple iPhone Slowdown – Apple Admits Slowing Older Model iPhones With Low-Capacity Batteries
Newstalk.com reported (“Apple admits slowing down old iPhone models with flagging batteries”) that Apple admitted old iPhones were slowed down with low-capacity devices to protect the components of the devices. Newstalk.com reported that
Apple has . . . admitted that the slowing of the [iPhone’s] central processing unit (CPU) does take place, although not to force consumers to upgrade their devices.
The act of slowing down a computer processor is called “downclocking” or “underclocking”.
Following a study by a Reddit user who claimed that Apple’s tech automatically slowed phones when the battery has a diminished charge capacity, the company said this was due to a need to protect electronic components.
In a statement, Apple said that, as they age, lithium-ion batteries used in its phones become less able to provide the top levels of electrical current needed.
The problems with peak current draws especially occur when batteries are cold or low on charge – “which can result in the device unexpectedly shutting down to protect its electronic components”, Apple said.
iPhone users had complained about their devices turning off abruptly even when they had a significant amount of charge left.
Apple iPhone Slowdown – Apple Admits to Intentionally Slowing Down CPU Frequencies of Older iPhone Models
Complex.com reported (“Apple Hit With Class Action Lawsuit for Purposely Slowing Down Older iPhone Models”) that “Apple may have made a misstep by admitting to intentionally slowing down CPU frequencies on older iPhone models, because some legal trouble is soon headed their way.” Complex.com reported that two individuals alleged in a class action lawsuit that
Apple’s policy of slowing down older iPhone models purposely targets the consumers’ wallets and disrupts the customer experience. [The Plaintiffs] also are claiming that Apple’s tactic of slowing down performance speeds of the iPhone in order to conserve battery life was never requested or agreed upon by customers, not to mention an obvious tactic to coerce people into forking over cash for an upgrade.
The discovery about Apple’s purposeful speed switching was first brought to light via a Reddit post, where a user shared screenshots of the performance speeds before and after getting a battery replacement (once a new battery was installed, the speed went back to factory settings.)
Apple iPhone Slowdown – The Reddit Post
Complex.com reported that
[a] recent Reddit post posited that Apple was intentionally slowing down iPhones with low-capacity batteries. And that same post concluded that most iPhone users whose phones have slowed probably attribute it to iOS updates.
A number of people (including the original poster) confirmed that when they did replace their batteries their phone performance and CPU clock speeds returned to normal. As pointed out by The Verge, this is relevant (especially if you have an outdated iPhone) because users whose phones slow down are probably tempted to pony up their dough for an unnecessarily expensive upgrade.
The Reddit post can be viewed by clicking Apple iPhone Slowdown Reddit post.
The Verge story referenced by Complex.com can be viewed by clicking “Apple confirms iPhones with older batteries will take hits in performance.”
Apple iPhone Slowdown – Is Your iPhone Slowing Down?
CNN Tech posted a story (“What to do if you think Apple’s slowing down your phone”), which contains information about, among other things, why Apple is slowing down phones and whether your iPhone is affected.
Apple iPhone Slowdown – iPhone 6 & iPhone 7 Owners
If you own, or owned, an iPhone 6 or iPhone 7 updated to iOS 10.2.1 (released January 23, 2017); iOS 10.3 (released March 27, 2017); iOS 10.3.1 (released April 3, 2017); iOS 10.3.2 (released May 15, 207); iOS 10.3.3 (released July 19, 2017); iOS 11.0.1 (released September 26, 2017); iOS 11.0.2 ( released October 3, 2017); iOS 11.0.3 (released October 11, 2017); iOS 11.1 (released October 31, 2017); iOS 11.1.1 (released November 9, 2017); iOS 11.1.2 (released November 16, 2017); iOS 11.2 (released December 2, 2017) and iOS 11.2.1 (released December 13, 2017) and have questions about the iPhone-related class action lawsuits or wish to discuss your potential legal rights, please fill out the form on the right above or send an e-mail to [email protected].
Dec 24, 2017 | Consumer Protection, Employment & Technology Archive
Consumers Making Hotel Room Reservations Allegedly Led to Believe They Were Dealing Directly with Hotels
Consumers Not Adequately Notified They Would Be Charged Immediately When Reservations Booked, Instead of After Arrival at Hotel
The Federal Trade Commission announced that Utah-based third-party hotel room reservation resellers have settled FTC charges that hotel room reservation resellers misled consumers through ads, webpages, and call centers which led consumers to mistakenly believe they were reserving hotel rooms directly from the hotel, and failed to adequately tell consumers that their credit cards would be charged immediately, rather than after they arrived at the hotel.
Hotel Room Reservation Reseller Defendants Barred from Further Deceptive Conduct
The FTC’s proposed order settling the FTC’s complaint will prevent the Defendants from further deceptive conduct in the future and specifies changes the Defendants must make to ensure consumers have the information they need to make informed hotel room reservation decisions.
The Hotel Room Reservation Reseller Defendants
According to the FTC, Reservation Counter, LLC and its two parent companies, Partner Fusion, Inc. and TravelPASS Group, LLC, sell hotel room reservations, or bookings, to consumers nationwide. The entities get hotel room inventory primarily through other online travel agencies (e.g., Expedia, Priceline, and Orbitz) and then market the rooms themselves.
Further, most of the Defendants’ hotel room reservation bookings result from search engine ads, which appear in response to consumers’ online searches for hotels. When consumers click on the link in one of the Defendants’ ads, they are sent to webpages owned by Reservation Counter and its parent companies which feature information about the hotel searched. Consumers can book hotel rooms online or by calling the phone number listed in the companies’ ads and webpages and speaking with sales agents at call centers controlled by the Defendants.
The FTC’s Complaint Against the Hotel Room Reservation Resellers for Permanent Injunction & Other Equitable Relief
According to the FTC’s complaint, the ads, webpages, and call centers create the impression that consumers are booking rooms directly with the advertised hotel, when, in fact, consumers are booking hotel rooms through the Defendants, not the hotel. According to the complaint, consumers who book through the Defendants may not be eligible to receive reward points or other hotel loyalty program benefits, and hotel policies, such as cancellation and refund policies, may not be the same as when booking directly from the hotel.
When booking hotel rooms through the Defendants, consumers must provide credit card or other payment information. In many instances, consumers are charged immediately for the cost of the hotel room, plus applicable fees and taxes, rather than after arriving at the hotel. According to the complaint, consumers are not adequately informed that they will be charged immediately.
The FTC’s Proposed Order Settling the Charges Against the Hotel Room Reservation Resellers
The FTC’s proposed order settling the charges prohibits Reservation Counter and its parent companies from making misrepresentations about their affiliation with hotels. The proposed order expressly prohibits the companies from using a hotel name or logo in any search engine ad, URL, website, webpage, or any other type of advertising in a misleading way. It also bars them from placing their telephone number directly near a hotel name, logo, or address in a manner that misrepresents that callers would be contacting the hotel directly.
In addition, the FTC’s proposed order requires the Defendants to disclose material information, including the total cost of a hotel room and when they will charge a consumer’s payment card. The order also requires the companies to disclose that callers to any of their hotel reservation call centers have reached an independent, third-party travel agency and to monitor their call centers to prevent misrepresentations.
According to the FTC’s complaint, filed in United States District Court, District of Utah, Central Division:
Defendants Reservation Counter, TravelPASS, and Partner Fusion have operated as a common enterprise while engaging in the [alleged] deceptive acts and practices . . .. These [D]efendants have conducted the business practices . . . as interrelated companies that have common control, officers, business functions, employees, and office locations. Each of these [D]efendants is jointly and severally liable for the acts and practices alleged below.
Defendants sell hotel room reservations, or bookings, to consumers. They obtain hotel room inventory primarily through affiliate network programs sponsored by first-tier online travel agencies . . . such as Expedia, Priceline, and Orbitz, but they advertise and market the available hotel rooms through their own advertisements, websites, and call centers.
Defendants advertise through online search engine marketing, using search engines such as Google, Yahoo, and Bing. A substantial majority of Defendants’ search engine advertisements are designed around a specific hotel brand name and a specific city. About 95 percent of Defendants’ bookings are made through search engine marketing.
When a consumer clicks a link in one of Defendants’ search engine ads, the consumer is directed to websites owned and controlled by Defendants, including ReservationCounter.com, ReservationDesk.com, and Reservation-Desk.com.
By following the link provided in Defendants’ advertisements, consumers can book hotel rooms online, using desktop, laptop, notebook, and tablet computers, and smartphone mobile devices.
Consumers also can book hotel rooms by calling the telephone number listed in Defendants’ advertisements and websites. Consumers using smartphone mobile devices can “click-to-call” a sales agent merely by clicking a link in the search results ad. Defendants have handled sales calls (and customer service calls) through their own call centers, located in several countries in Central America, since July 2012.
The phone number listed in Defendants’ search engine advertising acts as a customer identifier that allows the sales agent to access the caller’s online session. Thus, at the time the agent answers the call, the agent knows the specific hotel searched or last visited by the consumer.
At the time of booking, Defendants send the reservation and payment information, through Internet transmission, to the applicable [online travel agency], which processes the payment and transmits the reservation information to the booked hotel.
Defendants charge consumers for the amount paid to the hotel as well as amounts they and the [online travel agency] retain as fees for their services. Consumers also are charged a “tax recovery fee” to cover the anticipated taxes for the hotel room reservation.
During most or all times material to [the FTC’s] [c]omplaint, Defendants processed most hotel bookings using a business model in which the customer prepays the cost of the hotel room immediately at the time of the booking and not after the customer arrives at the hotel. In contrast, for guests booking rooms directly with a hotel, many hotels frequently require credit card or other payment information at the time the reservation is made in order to hold the reservation, but do not actually charge the consumer for payment of the hotel room, plus applicable fees and taxes, until after the consumer has arrived at the hotel.
Defendants’ hotel [room] reservation advertising and marketing practices . . . create the impression that consumers are booking hotel rooms directly through the advertised hotel, and thus, that reservations made through Defendants are subject to the same terms and policies as those applicable to consumers who book hotel rooms directly with the hotel. However, consumers who are members of the advertised hotel’s loyalty or reward program are not eligible to receive reward points or other program benefits when they book hotel rooms through Defendants, and the available hotel policies, such as payment or cancellation policies, are not necessarily the same as those for consumers who book their reservations directly through the hotel. Also, some special rates may not be available to consumers who book hotel rooms through Defendants, such as rates for weddings, conferences, or other special events where the hotel offers a discount rate for a specific block of rooms.
An Example of a Hotel Room Reservation Reseller Search Engine Advertisement
The FTC’s complaint provided [t]he following . . . example of a search engine advertisement that Defendants placed during the relevant period. A consumer who typed the phrase “Hilton Birmingham Alabama” into a Yahoo search engine box would see the following search results:
The first and second listed results are paid advertisements for hotel reservation websites owned and operated by Defendants. Each advertisement conveys the impression that clicking on the advertisement will take consumers to websites owned and operated by or directly for the advertised Hilton hotel located in the Birmingham, Alabama area.
The Hilton hotel name appears prominently in the headline of each advertisement in large bold lettering:
“Hilton Birmingham Alabama – Hilton.ReservationCounter.com”
Hilton Birmingham Al – 8 Perimeter Park South, Birmingham
The hotel address and links to information about the advertised hotel, such as amenities, map and directions, and photos, are included in each advertisement.
The second line of each advertisement – “ReservationCounter.com/Hilton” and “Reservation-Desk.com/Hilton” – is the “display URL.” In the above examples, Defendants added the venue-specific detail “Hilton” to the display URL. Although these display URLs include reference to Defendants’ URL, the ad conveys the impression that the reference to “Reservation Counter” or “Reservation-Desk” refers to the centralized booking center operated by or for the Hilton hotel chain.
Hotel Room Reservation Reseller Online Hotel & Call Center Reservation Practices
The FTC’s complaint also details the online hotel and call center reservation practices of the hotel room reservation reseller defendants, as well as the Defendants’ violations of the FTC Act for “deceptive representation that Defendants are the advertised hotel” and “deceptive failure to disclose material information regarding prepayment charges.”
Click FTC’s Proposed Order for the details of the FTC’s Proposed Order settling charges against the hotel room reservation reseller Defendants.
