A Korean civic group is demanding that Apple extend compensation to Korean consumers after the U.S. tech giant agreed to pay damages only in the United States over allegations that it misled customers by overstating iPhone artificial intelligence (AI) features. The group also called on Korean regulators to expedite a probe into Apple that has been pending for a year.
The Seoul YMCA's Consumer Mediation Office said in a statement Tuesday, "Apple must immediately submit materials to the Fair Trade Commission and voluntarily implement compensation in Korea on par with the U.S. settlement." The group warned, "If Apple continues to ignore and mock domestic consumers with an irresponsible attitude, it will face corresponding consumer backlash and market consequences."
The demand follows Apple's recent agreement to pay a total of $250 million (approximately 360 billion won) to resolve a class action lawsuit in the United States, with the group arguing that Korean consumers should receive equivalent compensation. According to Reuters the previous day, Apple was sued by U.S. consumers in 2024 for damages on the grounds that it had falsely and exaggeratedly advertised "Apple Intelligence" and next-generation "Siri" features to sell iPhones.
At its 2024 annual developer conference, Apple unveiled Apple Intelligence and announced that it would use the technology to enhance iPhones, including Siri. However, key features have yet to be updated, fueling consumer dissatisfaction. In Korea, the Seoul YMCA filed a complaint with the Fair Trade Commission (FTC) in March last year, alleging that Apple had violated the Act on Fair Labeling and Advertising.
"Even after the case came to light, Apple has offered no compensation, explanation, or apology to Korean consumers," the Seoul YMCA said. "Even in the U.S. settlement, the company is denying legal responsibility by invoking 'good faith.'" The group added, "A settlement over a case of false advertising and unjust enrichment cannot be dressed up as good faith. Agreeing to compensate consumers should be viewed entirely as an acknowledgment of responsibility for illegal conduct."
The Seoul YMCA also criticized the slow pace of the FTC's investigation. "Even though Apple has not even submitted materials, the FTC has left the investigation idle for more than a year without exercising any authority or taking any action," the group said. "We strongly urge the commission to stop leaving this case unattended and, even now, to mobilize all means to secure the materials and carry out a thorough investigation and strict measures accordingly."
Industry observers note that Apple, despite lagging behind competitors such as Google and OpenAI in AI capabilities, resorted to aggressive marketing that triggered the current situation. Apple is pursuing plans to integrate rival AI agents such as ChatGPT and Gemini into the iPhone.
Apple said, "We greatly value our relationship with Korean customers and have always focused on delivering the best products and services." The company added, "We strongly disagree with the Seoul YMCA's claims and will continue to discuss this matter with the Fair Trade Commission." Apple also maintained that Apple Intelligence supports Korean, allowing users to take advantage of dozens of features.
