Apple has agreed to pay up to $250 million to certain iPhone buyers in the United States to settle a lawsuit accusing the company of overstating the availability of artificial intelligence features linked to its Apple Intelligence platform.
The proposed settlement, filed in a California federal court on Tuesday and reported by the BBC, seeks to resolve a consolidated class action lawsuit brought against Apple last year over alleged false advertising tied to AI-powered iPhone capabilities.
Apple denied wrongdoing as part of the agreement.
The case centred on marketing claims related to Apple Intelligence and enhanced Siri features promoted alongside the iPhone 15 and iPhone 16 product lines.
Settlement targets claims over delayed AI rollout
Under the proposed deal, eligible US consumers who purchased iPhone 15 or iPhone 16 devices between June 2024 and March 2025 could receive compensation ranging from $25 to $95.
Settlement details at a glance
- Total proposed settlement value: $250 million
- Eligible devices: iPhone 15 and iPhone 16
- Eligible purchase period: June 2024 to March 2025
- Potential customer payout: Between $25 and $95
- Court filing location: California federal court
According to the lawsuit, Apple promoted AI features that were either unavailable at launch or had not yet been fully developed.
The legal complaint specifically challenged marketing around Siri enhancements that allegedly promised a more advanced AI-powered digital assistant experience.
Lawyers representing the plaintiffs argued in a revised complaint filed last week that Apple’s AI marketing campaign misrepresented the actual availability and capability of certain features.
“Apple promoted AI capabilities that did not exist at the time, do not exist now, and will not exist for two or more years, if ever,” the lawyers wrote, according to the BBC report.
Apple defends broader AI rollout
An Apple spokeswoman said the legal dispute focused on “the availability of two additional features” within a broader Apple Intelligence rollout that included several other capabilities.
“We resolved this matter to stay focused on doing what we do best, delivering the most innovative products and services to our users,” the spokeswoman said.
The settlement does not include an admission of liability or wrongdoing by Apple.
The company introduced Apple Intelligence as a central part of its AI strategy as major technology firms intensified investment in generative AI tools and digital assistants.
Pressure mounts in AI competition race
The lawsuit also highlighted broader competitive pressure facing large technology companies as they attempt to respond to rapid advances in artificial intelligence.
According to the complaint, Apple accelerated its AI marketing efforts in part to keep pace with the growing influence of companies such as OpenAI and Anthropic.
The plaintiffs argued that Apple presented Apple Intelligence as a breakthrough innovation capable of transforming Siri into a significantly more advanced AI assistant.
Lawyers claimed consumers received devices without the advertised functionality fully available.
“The iPhone 16 was delivered to consumers without Apple Intelligence, and Enhanced Siri never came,” the complaint stated, according to the BBC.
AI scrutiny expands across technology industry
The proposed settlement comes at a time when technology companies are facing increasing legal and regulatory scrutiny over AI-related claims, product readiness and consumer transparency.
Apple chief executive Tim Cook has previously faced criticism from some analysts and investors over the pace of innovation across Apple’s product ecosystem compared with newer AI-focused competitors.
The case underscores how AI marketing claims are becoming a growing legal risk for technology companies as competition intensifies across consumer devices, software and digital services.
If approved by the court, the settlement would close one of the earliest major consumer lawsuits tied directly to AI feature advertising in smartphones.