One of the biggest, most beveled companies on the planet is in new legal trouble, courtesy of its own digital retail business. Apple was sued last week in Buffalo, New York, in a class-action alleging deceptive practices and false advertising over its use of “buy” and “rent” buttons. The plaintiffs argue that saying you can buy or rent anything on the platform is “false and misleading,” because when Apple’s licenses for its featured content expire, so does yours, and it “must revoke the consumers’ access and use of the Digital Content without warning.” The suit alleges that Apple’s done this “on numerous occasions,” using screenshots and citations of the Sonic the Hedgehog film’s pricing to make its case.
“The reason people get so pissed off when their stuff disappears is because they thought they got to keep it,” says Aaron Perzanowski, a law professor at Case Western Reserve University and co-author of The End of Ownership, who follows cases like this one. Perzanowski has worked for years on projects including his book and on legal papers like “What We Buy When We Buy Now,” which explore an argument similar to the one at the heart of this lawsuit. “We came back with what we thought was very, very clear evidence under the kind of standards that you would need to establish in court that Apple and Amazon and companies like them were engaged in a massive, multibillion-dollar false-advertising scheme,” around their transactional language and what customers took them to mean, he says. Vulture asked him to break down the details of this lawsuit, get his opinion on why it’s a big deal for digital ownership, and why it’s been brought in New York after a similar suit against Amazon was dismissed a few weeks ago.
You Don’t “Own” That Song You “Bought”
And neither does Apple, which is kinda the point here. Apple is bound by licensing agreements which stipulate how and when it can sell songs, books, movies, TV shows, and other media on iTunes or other digital storefronts. “Defendant [Apple] can never pass title to the purchasing consumer,” the suit argues — unlike a Best Buy or a Target, which sell you a physical item you can carry out, hold onto, liberally loan out to friends, or pass down when you die. “Accordingly, when a licensing agreement terminates for whatever reason, Defendant is required to pull the Digital Content from the consumers’ Purchased Folder and it does so without prior warning to the consumer.”
All this amounts to deceptive business practices, false advertising, and unjust enrichment on Apple’s part, the suit claims, because if Apple didn’t own that copy of Montero anyway, it couldn’t “sell” it on iTunes in the first place. That’s the argument anyway.
Amazon made a big deal out of this over a decade ago with — of all books — 1984. The company remotely deleted unauthorized copies of the book off of customers’ Kindles and got sued by a high schooler, ultimately settling for $150,000. “Amazon has just proven that when I buy a book on the Kindle, I don’t really own it,” the student Justin Gawronski said in July 2009.
The same applies to Apple today, Perzanowski says. “They’re promising people one thing with the language of ‘buy’ and ‘purchase’ and ‘own’ that they use to promote these products. Then they weren’t delivering on that promise.”
Most of us probably don’t think too critically about what Apple does and does not own when click on the “buy” button, but the company’s lawyers have poured plenty of billable hours into lengthy documents explaining it in opaque contract language that we all ignore when we sign up for iTunes or rent a movie on Prime Video. (The Apple Media Services terms and conditions, last updated in September 2021, is 8,005 words long.) “Putting aside legal knowledge, just the way these things are written is, by design, hard to understand,” Perzanowski says.
“Buy,” on the other hand, is a sleight of simplicity — a single-syllable, active-trigger verb that can squeeze itself into any UX, no matter how complicated. We click the button and trust that we own it. “Unfortunately for those consumers who chose the ‘Buy’ option, this is deceptive and untrue,” the lawsuit states between screenshots and citations of Sonic the Hedgehog. “Rather, the ugly truth is that Defendant does not own all of the Digital Content it purports to sell.” It goes further, calling out the fact that in the case of Sonic, Apple is “selling” a virtual copy of the film for $5 more than Target’s $9.99 physical copy — a seller “actually passing title to such property forever.”
It’s not as though there aren’t alternatives to “buy.” Perzanowski’s done studies on how consumers react differently to digital storefronts when they encounter a “buy” versus “license” language, and how adding more transparency to transactions can improve customer experience. He’s also noticed how newer services like Disney+ — which don’t have years of customer indoctrination on a storefront to account for — eschew “buy” altogether when they introduce digital retail onto their platforms.
“I got an email from Disney a while ago, and it was like ‘Add these movies to your collection,’” he recalls. “A lawyer looked at this and said ‘Do not use the word “buy.” Do not use the word “purchase.”’ ‘Add it to your digital collection’ is a good way I think of avoiding the potential problem that Apple and Amazon have.” He also suggests “add” or “save for later,” as more neutral options. Apple could also replace “buy” with “get,” as it has in the past. But “none of them are elegant,” at least not as much as “buy.”
Apple’s Lawyers Have New York Trade Law to Thank
It’s also not as though Apple isn’t already sensitive to linguistic nuances that come with digital storefronts. It had to settle a $100 million class-action after being sued in 2011 over how it touted “Free” apps on the App Store that require in-app purchases. (Now it says “Get” when you go to download “freemium” apps like Candy Crush Saga.) Apple is a trillion-dollar company, and a similar “buy” button case brought against Amazon in California was thrown out recently, but New York comes with crucial advantages in its trade laws.
“In most states, to make your false advertising claim, you have to prove not only that you’ve been damaged by the false advertising, but you’ve got to show how that translates to some sort of financial harm,” Perzanowski says. “New York law sets what’s called a statutory damage amount” for both false advertising and deceptive trade practices. The damages for each alleged claim, respectively, are set at $500 and $50 per transaction.
Put more bluntly, New York makes it easier to take Apple to the bank. If 200,000 New Yorkers grabbed a few $5.99 movies or $1.29 songs on iTunes over the past three years (the statute of limitations), and those transactions were multiplied by $500 and/or $50 a pop, well, Perzanowski joked that he’s not the best at math, but: “Pretty quickly in a state that’s as big as New York, we’re talking about billions of dollars in damages.” Excelsior!
Of course, that’s if Apple chooses to fight and loses. He thinks that if things go well for the plaintiffs, the most likely scenario is the trillion-dollar company settles: “Apple is going to say, ‘We have a significant percentage of all the money on planet Earth, how much does it take for you to go away?’”
He’s not ruling out Apple changing the “buy” button to something like “get,” but he’s not optimistic about Apple changing its stance on “buy” language in general. “One, I don’t think they’d ever get the copyright holders to agree to that,” he says. “And two, from their perspective, at least right now, there’s probably not enough market demand for those kinds of features.”
Apple has also grown far beyond just being a hardware company also selling digital stuff. Its newer business gets nothing out of a “buy” reimagining. “They don’t want people to lend the new season of Ted Lasso to their neighbor,” Perzanowski says. “They want their neighbor to sign up for Apple TV+. So I think it’s probably even harder for them now than it would have been 10 or 15 years ago to make that move.”
Whatever happens will take time. “If you’re Apple, you want to slow walk this. You want to get as much distance from the allegedly deceptive behaviors. You want to make it as costly, as expensive as possible for the class-action lawyers,” he says. “The filing of the complaint is, if not step one, incredibly early in this process. I think it’s gonna take a while before we can see how the courts are likely to respond.”
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