Apple Settles Antennagate, Will Pay iPhone 4 Users in the United States

Apple this week settled a class-action lawsuit that accused the company of shipping its iPhone 4 handset with an antenna design so flawed that users could inadvertently kill the wireless signal simply by holding the device. Apple could ultimately pay out hundreds of millions of dollars to customers who purchased the buggy device in the United States.

"Apple misrepresented and concealed material information in the marketing, advertising, sale, and servicing of its iPhone 4," the class-action suite claimed, "particularly as it relates to the quality of the mobile phone antenna and reception and related software."

"This settlement relates to a small number of customers who indicated that they experienced antenna or reception issues with their iPhone 4, and didn't want to take advantage of a free case from Apple when it was being offered in 2010," an Apple statement reads. However, that "small number of customers" isn't so small: 25 million people in the United States qualify for the settlement, according to the lead attorney in the case.

Under the terms of the agreement, Apple will pay each US-based iPhone 4 user $15 or give them a free bumper case. The company will notify customers of the choices via email some time in April, and they'll have 120 days in which to take advantage of the overdue apology.

Apple released the iPhone 4 in mid-2010 and immediately began getting complaints about the device's reception quality and other issues. Many users experienced a so-called "death grip" in which holding the phone a certain way could kill the wireless signal, suddenly ending in-progress phone calls.

Apple ignored the issue for weeks and then hosted a hastily arranged press conference at which it tried to claim that signal loss of this type—called attenuation—was common with its competitors, too. However, more experienced wireless companies had learned decades ago not to place their antennas on the outside of devices for specifically this reason, and Apple was correctly blamed for choosing a pretty iPhone 4 design over usability. The company never admitted its error but offered customers free bumper cases—which prevent the signal loss—for a short time, hoping the issue would go away.

It never did, and in late 2011, the official biography of the late Steve Jobs revealed that Apple's former CEO acknowledged the iPhone 4 design was flawed even though he never admitted so publicly. Apple quietly redesigned the iPhone 4 antenna twice, trying to fix the problem, first with an iPhone 4  version for Verizon in early 2011 and then with the iPhone 4S revision in late 2011.

Consumer Reports infamously never recommended the iPhone 4 because of this problem, which it was able to easily reproduce in its labs.

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