Thu, Aug 18, 2011 - Page 10 News List

South Koreans sue Apple over iPhone user data

AP and Bloomberg, SEOUL

A group of nearly 27,000 South Koreans is suing Apple for US$26 million for what they claim are privacy violations from the collection of iPhone user location information.

Each person in the suit is seeking 1 million won (US$932) in damages, Kim Hyeong-seok, one of their attorneys, said yesterday. He said they are targeting Apple Inc and its South Korean unit to “protect privacy” rights.

Apple spokesman Steve Park in Seoul declined to comment.

Apple has faced complaints and criticisms since it said in April that its iPhones were storing locations of nearby cellphone towers and Wi-Fi hot spots for up to a year. Such data can be used to create a rough map of the device owner’s movements.

Apple also said a software bug caused iPhones to continue to send anonymous location data to the company’s servers even when location services on the device were turned off.

The company has said it will no longer store the data on phones for more than seven days, will encrypt the data and will stop backing up the files to user computers. It also has fixed the bug with a free software update.

Kim took Apple to court earlier this year over iPhone privacy and was awarded 1 million won.

He said he expected the first hearing in the new case to take place in October or November.

If the court in the southern city of Changwon rules in favor of the plaintiffs, the total award would come to about 27.6 billion won. Cupertino, California-based Apple — the most valuable company in the US — earned US$7.31 billion in its fiscal third quarter.

Jung Ogk-taek, an official at the Changwon District Court, said it was not clear how much time would be required to reach a verdict.

Kim said the decision to seek damages of only 1 million won per person reflects that South Korean courts do not generally award amounts as high as their counterparts in the US.

He said 26,691 plaintiffs were listed in the civil suit filed yesterday. Another 921 are minors and lawyers need to obtain the consent of their parents before they can join, Kim said. He expects that to take about two weeks.

South Korea’s communications regulator earlier this month ordered Apple’s local unit to pay a 3 million won fine for what it said were violations of the country’s location information laws.

Separately, Apple is likely to invest about US$1 billion in Sharp Corp’s Kameyama factory in Japan to secure supply of displays for iPhones and iPads, MF Global FXA Securities Ltd said in a sales note yesterday.

“This would have a material impact on Sharp’s profitability,” the note said. “We expect positive news flow to come out over the next few months.”

In December, the Nikkei Shimbun reported that Sharp would invest about ¥100 billion (US$1.3 billion) to build a new display production line for Apple, which would mainly shoulder the cost.

The newspaper reported on June 2 that Sharp plans to increase its production at the Kameyama No. 2 plant after receiving orders from Apple.

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