Apple has settled a class-action lawsuit for $250 million after consumers alleged the company oversold artificial intelligence features that failed to materialize on new iPhones, with payouts ranging from $25 to $95 per eligible device owner depending on how many people ultimately file a claim.
When Apple shipped new iPhones in September 2024, the promised Intelligence features were absent. "The iPhone 16 was delivered to consumers without 'Apple Intelligence,' and Enhanced Siri never came," the lawyers said.
The problems persisted beyond launch. Apple delayed the release of an upgraded Siri over quality problems in March 2025. Notification summaries, another Intelligence feature, misrepresented news reports, prompting Apple to disable that functionality entirely.
Apple denied wrongdoing in the settlement, maintaining the dispute relates only to "the availability of two additional features" within a broader suite of Apple Intelligence services, according to court documents.
"Since the launch of Apple Intelligence, we have introduced dozens of features across many languages that are integrated across Apple's platforms," Apple spokeswoman Marni Goldberg said in a statement. "We resolved this matter to stay focused on doing what we do best, delivering the most innovative products and services to our users."
The settlement applies to U.S. consumers who purchased qualifying iPhone 15 and iPhone 16 devices between June 10, 2024, and March 29, 2025. Roughly 36 million devices are covered by the lawsuit, representing units sold in the U.S. during that period. Apple must send notices to eligible users within 45 days of May 5.
The case, brought by plaintiff Peter Landsheft who challenged Apple's marketing claims, marks one of the first major consumer protection settlements specifically targeting AI product marketing. The outcome arrives as regulators and courts establish new frameworks for evaluating artificial intelligence performance claims.
The settlement's implications extend beyond Apple. As companies race to integrate AI features, the case establishes early precedent for how courts may handle the gap between AI marketing promises and technical reality—a growing concern as AI becomes central to consumer products.
