Apple to Pay Up to $95 to iPhone Owners in $250M AI False Advertising Settlement

Apple Settles AI False Advertising Lawsuit for $250 Million

Owners of certain iPhones may receive cash payments of up to $95 after Apple agreed to a $250 million settlement in a class-action lawsuit alleging false advertising of its artificial intelligence capabilities.

The lawsuit, filed on behalf of U.S. consumers in the U.S. District Court for the Northern District of California in San Francisco, claimed Apple misled buyers by promoting AI features for its virtual assistant Siri that were not yet available. The company introduced these features as part of its "Apple Intelligence" software updates with the iPhone 16 in September 2024.

Settlement Details and Eligibility

The proposed settlement, if approved by a judge, would cover approximately 37 million devices purchased in the United States between June 10, 2024 and March 29, 2025. This includes all iPhone 16 models as well as the iPhone 15 Pro and iPhone 15 Pro Max.

Eligible customers will receive a minimum payment of $25 per device, with potential payouts increasing to $95 depending on the number of claims filed and other factors, according to court documents.

Consumer Backlash Over Delayed AI Features

The lawsuit alleged that Apple's marketing campaign for "Enhanced Siri" features led consumers to purchase devices under the impression that these capabilities were immediately available. However, the features were not released as promised, prompting widespread dissatisfaction.

"Buyers would not have purchased the Eligible Devices or would have paid significantly less, had they known Enhanced Siri features were not available," the court filing stated.

Apple, headquartered in Cupertino, California, has faced growing pressure to compete in the AI space amid rapid advancements by rivals such as Google and Samsung. Despite its marketing push, the company has yet to deliver a fully upgraded Siri, though an update is expected later this year, likely at its annual developer conference in June.

Next Steps for Affected iPhone Owners

Customers eligible for payments will be notified via email or mail and can file a claim through a dedicated settlement website. The preliminary approval hearing is scheduled before U.S. District Judge William H. Orrick.

If approved, this settlement would rank among the largest ever for Apple in a consumer class-action lawsuit.

— Kelvin Chan, AP Business Writer