New York resident files quixotic suit over iPhone price cut

Strange things are happening this week in the borough of Queens, as one New York resident has decided to sue Apple, Steve Jobs and AT&T.

The erratic play of the New York Mets appears to have spurred at least one city resident and iPhone owner on a perplexing quest for justice.

Either the iPhone price cut is making people wacky, or there's something in the water in Queens. CNET Networks

Dongmei Li, a resident of the borough of Queens, sued Apple earlier this week for "price discrimination" brought on by the $200 drop in the price of the iPhone announced earlier this month by Apple CEO Steve Jobs. Li names Apple, Jobs and AT&T as defendants in her suit, filed on Monday and spotted by AppleInsider.

The claims in the case make about as much sense to me, a long-suffering Mets fan, as the continual game of bullpen roulette played by team manager Willie Randolph, who also plies his trade in Queens (for now). According to documents filed in the U.S. District Court for the Eastern District of New York, there are three central claims to Li's case.

The first? "Apple's price reduction has hurt early purchasers' competition with Apple because they cannot sell it for as high a profit as they could have before the price cut." Li says she bought the $499 4GB model, discontinued after the price cut, on iPhone Day. Obviously, nobody's going to spend more than $499 on a 4GB iPhone today when they can go out and buy the 8GB one for $399, so Li's potential profits are indeed dashed.

But it's not like the early iPhone resellers made substantial profits on their purchases in the first place. And is Apple really obligated to take into account the potential profits of individuals reselling their iPhones when making pricing decisions? I'm not lawyer, but that theory seems a bit off the straight and narrow, kind of like a Guillermo Mota fastball.

The second one is even better. "Apple's price reduction has hurt early purchasers' competition with later purchasers because they cannot resell their iPhones for as low a price as later purchasers may." Why not? What exactly is preventing you from selling your iPhone for as low a price as you want?

If you're serious, Ms. Li, I'll give you ten bucks for it. If that's too high, I can come down to $5. But that's my lowest offer.

That's not even my favorite one. In another claim, she advances one of the most creative conspiracy theories I've read yet concerning Apple's motivation for the iPhone price cut.

Both the Mets, and this lawsuit, could use your prayers. Flickr user saragoldsmith

First, she alleges that Apple is losing money on each sale of a $399 8GB iPhone. Just for the sake of argument, we'll assume that illogical unsupported statement is accurate. So, then, what would be Apple's motivation?

"Apple is selling its iPhone for an unreasonably low price to hurt competition between early and later purchasers so that the early purchasers cannot resell for as high a profit as they could have without the price cut. Apple is selling its iPhone for an unreasonably low price to hurt the competition that purchasers pose to it from reselling their iPhones."

There you have it, folks, it's all become clear. Apple wasn't trying to sell more iPhones during the upcoming holiday season. They weren't trying to kick-start demand to hit their sales targets for the quarter. They weren't trying to milk profits out of their faithful early adopters. They are trying to rip the heart out of that nonexistent iPhone resale market to deny profits to individuals who thought they were Apple's resellers.

I thought New York was a hip, tech-savvy place these days. There's no shortage of iPhone owners irked by the steep and sudden drop in price, but this is the wackiest iPhone lawsuit I've seen since that guy from suburban Chicago who thought Apple was forcing his battery to die after a year. Probably a long-suffering Cubs fan.

People, it's just baseball, let's not let it drive us to commit wild acts of litigation. However, I can understand what it feels like to battle against the odds. After all, ya gotta believe.

About the author

    Tom Krazit writes about the ever-expanding world of Google, as the most prominent company on the Internet defends its search juggernaut while expanding into nearly anything it thinks possible. He has previously written about Apple, the traditional PC industry, and chip companies. E-mail Tom.

     

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