Smith v. Apple, Inc.

Background

This putative class action involved allegations that First Generation, Series 1 through Series 6, and Series SE Apple Watches contained an undisclosed and unreasonably dangerous safety hazard. Plaintiffs alleged that swelling batteries could cause the screens to detach, crack, or shatter, exposing sharp edges, causing operational failure, and creating risks of cuts, abrasions, lacerations, and other injuries.

The operative complaint asserted claims under California’s Unfair Competition Law, the California Consumers Legal Remedies Act, various state-law fraud-by-omission theories, the Song-Beverly Consumer Warranty Act, and consumer-protection and unfair-competition laws in New York, Texas, and Florida. After discovery, investigation, mediation, and earlier motion practice, the parties entered into a settlement. The court had previously granted preliminary approval.

Settlement terms

The settlement class consists of natural persons residing in the United States who owned or formerly owned a First Generation, Series 1, Series 2, or Series 3 Apple Watch for personal or household use and who were reflected in Apple’s records as having reported a potentially battery-swelling-related issue in the United States between April 24, 2015, and February 6, 2024.

Apple agreed to make a non-reversionary payment of $20 million. The fund covers court-approved attorneys’ fees and costs, settlement-administration expenses, incentive payments, and class-member payments. Eligible class members may receive $20 for each covered device, or a pro rata amount below $20 if necessary. If more than $50,000 remains after costs are allocated, class members may receive up to $50 per covered device. Any remaining funds would go to the Rose Foundation’s Consumer Products Fund under the settlement’s cy pres provision, meaning a payment to an organization serving interests related to the class when funds remain undistributed.

The release covers claims against Apple and its subsidiaries arising out of or related to the claims made in this lawsuit, including certain claims of which the releasing parties were unaware. Class members who did not opt out cannot bring or continue related lawsuits against Apple. Nineteen class members requested exclusion, and no class members objected.

Final settlement approval

Under Federal Rule of Civil Procedure 23, a class settlement must receive court approval after a hearing and must be fair, reasonable, and adequate. The court found that the notice plan complied with the rule. As of March 19, 2025, direct notice had reached 525,542 class members, or 97.05% of the class, according to the settlement administrator.

The court concluded that the settlement was fair, adequate, and reasonable. It considered the strength of plaintiffs’ claims, litigation risks, the complexity and likely duration of further proceedings, the settlement amount, the discovery completed, and the class members’ response. The court noted that plaintiffs faced risks involving pleading challenges, class certification, summary judgment, trial, and disputes over whether the watches had an actionable defect. The court also found that counsel had reviewed approximately 1.4 million pages of documents and conducted extensive expert analysis.

The court granted plaintiffs’ motion for final approval of the class action settlement.

Attorneys’ fees and litigation expenses

Class Counsel requested $5,000,000 in attorneys’ fees and $433,417.83 in litigation expenses. The court found the fee request reasonable under the percentage-of-the-fund method. The requested fee represented 25% of the $20 million settlement fund, the benchmark commonly used in Ninth Circuit common-fund cases.

The court considered the recovery obtained, the risks of further litigation, counsel’s work and skill, the contingency arrangement, and a lodestar cross-check. Counsel reported 5,893.10 hours of work and a lodestar of $5,545,004.80. The court found the requested fee lower than the reported lodestar and found the requested expenses reasonable, including expert fees, mediation expenses, court fees, travel, copying and postage, research and investigation, and third-party subpoena expenses.

The court granted the request for litigation costs and awarded Class Counsel $5,000,000 in attorneys’ fees and $433,417.83 in litigation expenses. The court will withhold 10% of the attorneys’ fee award until the required post-distribution accounting is filed.

Service awards and remaining directives

Class Counsel requested a $5,000 incentive award for Lead Plaintiff Chris Smith and $2,000 for each of the eleven remaining named plaintiffs. The court found the requested awards reasonable based on the plaintiffs’ work, time spent, participation in discovery, document production, and involvement in reviewing and approving settlement terms. The court therefore granted the requested service awards, totaling $27,000.

The parties and settlement administrator were directed to implement the settlement. The parties must file a proposed final judgment within 21 days of the order. Class Counsel must file a post-distribution accounting after settlement checks become stale, or after all funds have been paid if no checks are issued. The court may hold a hearing after that accounting is submitted.