A Federal court in San Jose has rejected Apple’s request for a dismissal of the class action lawsuit against Apple initiated by an angry parent whose child was able to purchase $200 worth of in-app purchases through a free app. Garen Meguerian, the lead plaintiff in the case, says that his daughter was able to purchase the $200 worth of “zombie toxin” and “gems” without his knowledge or permission.
While Apple has argued that they have instituted a policy last year requiring that the iTunes store password be entered before any in-app purchases can be made thus, in theory, apparently, rending the issue moot, the Judge has ruled that parents have been “misled by Apple’s presentation of these “freemium” games as free and that Apple didn’t adequately inform consumers about the potential costs.”
Explains Meguerian’s complaint, “Among the many thousands of Apps that Apple offers for sale are gaming Apps targeted at children. Numerous gaming Apps are offered for free, although many such games are designed to induce purchases of what Apple refers to as “In-App Purchases” or “In-App Content,” i.e., virtual supplies, ammunition, fruits and vegetables, cash and other fake “currency,” etc., within the game in order to play the game with any success (“Game Currency”). These games are highly addictive, designed deliberately so, and tend to compel children playing them to purchase large quantities of Game Currency, amounting to as much as $100 per purchase or more.”
The complaint goes on to say that “Apple requires its users to authenticate their accounts by entering a password prior to purchasing and/or downloading an App or buying Game Currency. Until recently, however, once the password was entered Apple permitted the user, even if a minor, to buy Game Currency for up to fifteen minutes without re-entering the password. This practice enabled minors to buy Game Currency, in one click sums of $99.99 or more without entering a password, causing Apple to pocket millions of dollars from such Game Currency transactions with minors and without the authorization of their parents, whose credit cards or PayPal accounts are automatically charged for the purchases. Further, because the passwords now required for purchases of Game Currency are the same passwords required for any Apple purchase, minors aware of such password may purchase Game Currency without authorization from their parents for the purchase.”
That last addresses nearly head-on Apple’s argument for dismissal, arguing that even with the new password requirement, because kids know their parents’ password, and no other authorization is required, kids are still able to make these in-app purchases.
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Well, duh.
The judge didn’t address that (so far as we know) in the ruling rejecting Apple’s motion for a dismissal, however he did make clear that regardless, there is an issue with Apple not being completely transparent about how free apps aren’t really free.
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