Apple sued over iPhone 4 antenna problem

11:26 AM PST 07/01/2010 by Gabriel Madway, Reuters, AP

At least three complaints have surfaced in a week

Apple has been sued by iPhone customers in at least three complaints related to antenna problems on its newest model.

Apple launched the iPhone 4 last week to a huge groundswell of demand. But the launch was also plagued by complaints from some customers about poor call reception on the device when they held it in a certain way.

The problems have been a hot topic on the Internet, but it is unclear how many people have been affected. The issue does not seem to have hurt iPhone sales so far. Apple sold 1.7 million new iPhones in the first three days.

A putative class action filed Tuesday in the U.S. District court for the Northern District of California against Apple and AT&T -- the iPhone's exclusive wireless carrier in the United States -- includes allegations of fraud by concealment, negligence, intentional misrepresentation and defective design.

"The iPhone 4 manifests design and manufacturing defects that were known to defendants before it was released which were not disclosed to consumers, namely, a connection problem caused by the iPhone 4's antenna configuration that makes it difficult or impossible to maintain a connection to AT&T's network," the lawsuit said.

It said Apple and AT&T have failed to provide customer support and customers have been left with only thee remedies: "hold their phones in an awkward and unnatural manner," pay a 10% restocking fee and return their phones, or pay $29.95 to buy one of Apple's cases that are said to fix the reception problem.

The iPhone 4 represents a complete redesign over the previous model. A band around the rim of the smartphone acts as its antenna.

The company responded to user complaints last week by saying the antenna performance of every wireless phone is impacted in some way by the how it is held, depending on where the antenna is located.

Apple and AT&T both decline to comment Thursday.

In another purported class action complaint filed on Wednesday against Apple and AT&T, in the U.S. District Court for the District of Maryland, Kevin McCaffrey and Linda Wrinn said they were sold "defective" iPhone 4 units, which drop calls and data service, "when held in a manner consistent with normal wireless phone use."

Both suits cite emails reportedly sent from Apple Chief executive Steve Jobs, responding to iPhone customers complaints' about reception. Those responses were widely circulated on the Internet.

In one response, Jobs said: "Just avoid holding it (the iPhone] in that way."

The cases are 10-02862 Goodglick v. Apple Inc, and 10-01776 McCaffrey et al v. Apple Inc. et al.

The shares of Cupertino, California-based Apple fell 1.5% to $247.80 in midday trading on the Nasdaq. The shares of Dallas-based AT&T fell 0.4% to $24.18 on the New York Stock Exchange.
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