Apple is paying a quarter of a billion dollars to settle legal complaints that it sold iPhones on the promise of AI features that were never delivered. The settlement draws a sharp line under one of the most damaging chapters in the company’s recent history — and raises hard questions about how it marketed the iPhone 16 to consumers.
The company settled a shareholder lawsuit agreeing to pay $250 million to consumers who bought iPhone 16 models and certain iPhone 15 devices during a specified window. Anyone in the United States who purchased an iPhone 16, iPhone 16E, iPhone 15 Pro, or iPhone 15 Pro Max between June 10, 2024, and March 29, 2025, can file a claim. Payouts start at $25 per device and cap at $95, depending on how many people apply.
Apple denied any wrongdoing as part of the settlement. The company pointed to the dozens of Apple Intelligence features it has released since the initial launch — including Visual Intelligence, Live Translation, Writing Tools, Genmoji, and Clean Up — and described the settlement as a way to stay focused on delivering innovative products. “We resolved this matter to stay focused on doing what we do best,” an Apple spokesperson said.
The Promises Apple Couldn’t Keep
The core of the legal complaints was straightforward. Apple’s advertising for the iPhone 16 centred heavily on specific Apple Intelligence features — particularly an upgraded, more capable Siri — that were not ready when the phones launched in September 2024. Some features arrived late. Others, including the enhanced Siri capabilities that were central to the marketing campaign, have still not reached consumers.
According to the settlement documents, Apple “allegedly saturated the market with deceptive ads, inducing consumers to purchase iPhones based on the promise of certain Enhanced Siri features.” The word “allegedly” carries legal weight — Apple admitted no fault — but the $250 million payout speaks for itself.
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The Siri upgrade story has been one of delays and disappointments. Reports suggested an improved AI-powered Siri would arrive in early 2026. It did not. Apple announced it would use Google’s Gemini AI models to power the upgrade, and Google has since confirmed the feature is coming before the end of 2026. The settlement documents acknowledge that Apple anticipates delivering additional Siri Apple Intelligence features in future software updates at no extra cost to consumers.
The episode reflects a broader struggle Apple has faced in the generative AI race. While Android rivals moved quickly to integrate AI features into their devices, Apple’s rollout of Apple Intelligence has been partial, delayed, and — according to a quarter-billion-dollar legal settlement — misleading. For a company that built its reputation on delivering products that work exactly as promised, that is a significant reputational bruise.
Consumers who qualify for the settlement can file a claim for their share of the $250 million pool. The final payout per device will depend on total claim numbers.
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