Business, Economics and Jobs

Apple to hand out $100 million in iTunes cards in lawsuit settlement


A man navigates through the new iPad 2 during its launch in the Philippines at an Apple store in Manila on April 29, 2011.


Noel Celis

Apple has agreed to hand out more than $100 million in iTunes cards to settle a lawsuit alleging it had improperly charged kids for playing games on its mobile devices.

The case, which began around two years ago, focused on parents alleging that Apple didn't create adequate parental control meant to prevent children from buying extra features while playing games on iPhones and iPads in 2010 and 2011, reported the Associated Press. Parents said they only knew their children were purchasing features — all designed for games directed at children as young as 4 years old — when they received bills or other notifications after the fact.

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As of March 2011, Apple has introduced tougher controls for in-game purchases, which is now part of a software update, according to In an agreement filed last week, Apple will give an iTunes card worth $5 to each of the estimated 23 million account-holders affected. Those who can prove their bills exceeded that amount will receive more, and charges over $30 will be given cash refunds.

GigaOM noted that the settlement has not yet received preliminary approval from a federal judge, but when it does, Apple's notification period will start and it will begin accepting claims. Once the claims are in, a judge will approve the final settlement and Apple will make the payments, which should begin in late 2013 or early 2014.