Apple Loses Round In App-Privacy Lawsuit

In a blow to Apple, a federal judge has refused to dismiss a potential class-action lawsuit stemming from allegations that app developers scooped up iPhone users' address books and photos without their permission.

U.S. District Court Judge Jon Tigar in San Francisco rejected Apple's argument that the user who brought the case, New Jersey resident Maria Pirozzi, lacked the kind of injury that would warrant a lawsuit.

Pirozzi alleged that she would not have paid as much as she did for an iPhone had she known that app developers would be able to access her personal information without her permission. She also said that Apple misrepresented its app store policies, which said that all apps “run in a safe environment” and are not capable of accessing data from other apps.

Tigar ruled that those allegations were sufficient for Pirozzi to proceed in court -- even though Pirozzi did not say that any apps obtained her personal information. “Plaintiff argues that she overpaid for her iPhone as a result of Apple’s alleged misrepresentations,” Tigar wrote. “That is an allegation of economic injury synonymous with 'lost money.'”



Tigar specifically ruled that Pirozzi could proceed with her claims that Apple violated several California consumer protection laws, including laws regarding unfair competition and false advertising.

The decision doesn't mean that Apple will lose the lawsuit, but still marks a major loss for the company, which will now have to provide Pirozzi with a host of evidence to prepare for trial. Doing so could take up to one year, and likely will prove expensive for Apple, predicts Internet legal expert Venkat Balasubramani. “Part of the problem is that a company like Apple is big and has a ton of records,” he says.

Pirozzi initially sued Apple in March 2012, several weeks after developers first reported that popular apps, including Hipster and Path, surreptitiously uploaded users' address books. Many of those developers are facing a separate privacy lawsuit, which is pending in front of Tigar.

Pirozzi says in her lawsuit against Apple that she downloaded and installed apps for Angry Birds and Facebook, but doesn't allege that those apps uploaded her contact lists, photos or other data.

But Tigar said in his ruling that Pirozzi can proceed anyway, on the theory that Apple misled her. “Apple claimed that apps could not access data from other apps, and, according to the Second Amended Complaint, in actuality, they can and have. Those allegations are enough to establish ... standing,” Tigar wrote.

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