The Times Online is reporting that after an 11-year-old girl’s iPod touch exploded, Apple offered a refund…but only if the family signed a confidentiality agreement that would leave them open to litigation if they told anyone what happened.
Ken Stanborough, 47, from Liverpool, dropped his 11-year-old daughter Ellie’s iPod Touch last month. “It made a hissing noise,” he said. “I could feel it getting hotter in my hand, and I thought I could see vapour”. Mr Stanborough said he threw the device out of his back door, where “within 30 seconds there was a pop, a big puff of smoke and it went 10ft in the air”.
Mr Stanborough contacted Apple and Argos, where he had bought the device for £162. After being passed around several departments, he spoke to an Apple executive on the telephone. As a result of the conversation, Apple sent a letter to Mr Stanborough denying liability but offering a refund.
The letter also stated that, in accepting the money, Mr Stanborough was to “agree that you will keep the terms and existence of this settlement agreement completely confidential”, and that any breach of confidentiality “may result in Apple seeking injunctive relief, damages and legal costs against the defaulting persons or parties”.
Mr. Stanborough did not sign the letter, out of concern that that his family would be exposed to litigation after talking about how his daughter’s freaking iPod exploded. It’s worth underlining here that the family wasn’t threatening a lawsuit, or asking for more money than they paid, they just wanted a refund. The story also contains a disturbing claim that Apple tried to keep a report from the American Consumer Product Safety Commission out of the hands of a reporter by filing repeated exemptions.
Apple is (in)famous for keeping their new products under wraps, but asking people to sign confidentiality agreements for faulty products seems to enter a new realm.
That's what you get for playing too much Coldplay.
Not that it makes a ton of difference, but a "gag order" comes from a court, and has legal consequences if not honored. This arrangement is more accurately described as "hush money".
It's not a gag order, but simply a confidentiality agreement that doesn't enter any "realm" but standard. Essentially, Apple doesn't believe it's done anything wrong, and simply giving the money back would be like admitting they did, so they ask for something in exchange, in this case that the family doesn't spout off about Apple's hardware being faulty due to an explosion that may or may not have been Apple's fault.
So Apple's product explodes, and it may or may not be their fault? What, did the floor introduce combustible material into it?
From Apple legal's perspective, that very well may have been the case. It's not like this was new out of the box and exploded, there is no evidence to say that it hadn't been damaged.