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Apple agrees to some OS X refunds

As part of a proposed settlement to a class-action lawsuit, the Mac maker says it will repay the purchase price of the Mac operating system to certain customers.

Apple Computer has reached a tentative settlement in a class-action lawsuit that alleged the company had failed to fully support Mac OS X on some G3-based Macs.

In court documents filed Tuesday, the Mac maker agreed to refund the $129 purchase price of Mac OS X for customers who bought it for use on certain G3 Macs and have never been able to fully take advantage of it.

The proposed deal offers customers two options, said Thomas Ferlauto of King & Ferlauto, the Los Angeles-based law firm that brought the class-action suit.

"If you are completely dissatisfied (with Mac OS X), you can return it and get your money back," Ferlauto said. "If you want to keep OS X, but are kind of annoyed that you don't have full support, you can get (a $25) coupon."

The deal would settle a lawsuit filed in Los Angeles Superior Court in January 2002. The suit claimed that Apple had promised that OS X would be "fully optimized" to run on all G3 machines but charged that such optimization was not done. As a result of failing to write the necessary drivers, the suit said, performance on older G3s was degraded "so severely that OS X is rendered an unrealistic option."

Apple said in Tuesday's court filing that it "continues to vigorously deny all of the material allegations" of the lawsuit but is willing to settle to avoid the costs of continuing to fight the legal action. An Apple representative declined to comment further.

The settlement would apply to those who bought early iMacs (Bondi Blue and fruit-colored models) and older iBooks; the first PowerBook G3 models released (through the one that had a bronze keyboard); the first three Power Mac G3 models; and the Power Mac G3 all-in-one, introduced in April 1998.

To be eligible, people must own or have owned one of those machines and purchased Mac OS X for that computer on or before May 15, 2003.

Owners would be required to send in their OS X installation discs. They would also have to sign an affidavit that says they have not regularly used the operating system on the machine in question and that they will not reinstall Mac OS X on it.

Alternatively, owners can keep using Mac OS X and receive a $25 coupon good toward a $99 purchase at Apple's online store or toward telephone orders.

Apple has also agreed to pay up to $350,000 in legal fees to King & Ferlauto. News about the tentative deal was first reported by Mac enthusiast site MacCentral.

Graphics details
The suit originally sought to force Apple to develop a DVD movie player for all G3 Macs as well as to compel the company to support several older graphics cards that are used in early G3 models. The suit also sought damages for those customers who bought Macs that performed worse when running OS X than when running Mac OS 9.

"Settlements are by their nature compromises," Ferlauto said. "You don't get everything you want."

Ferlauto noted that after the lawsuit was filed, Apple releases an update to Mac OS X, version 10.1.5, that offered improved graphics performance for machines that use the ATI Rage graphics card.

When Apple first released Mac OS X in March 2001, a number of its features were not fully supported, including DVD playback and CD burning. The Cupertino, Calif.-based computer maker later added DVD playback with version 10.1 but did not support all G3 models.

Assuming that a judge signs off on the proposed deal at a Sept. 2 hearing, Apple will publicize the details of the deal in newspaper advertisements and carry a link to the settlement terms on the front page of its Web site. Those who own the affected machines will have a chance to object or to opt out of the deal before it becomes final.