Planned obsolescence is when products are intentionally designed  to fail after a certain age or amount of use. This is obviously illegal, but it may be more common than many people realize. The tech world is certainly no stranger to this controversy, and a number of software and hardware developers have been accused of this misconduct in the past. The concept is a natural outgrowth of more traditional product manufacturing, where a manufacturer could choose to use better components to prolong product life, versus cheaper products that could do the same function but would not wear as well over time; so, it was an economic decision. In that circumstance there is clearly nothing wrong with building a cheaper product for a presumably cheaper price. When you consider that the tech world relies heavily on people constantly upgrading to new equipment and apps, it is easy to see why planned obsolescence could be highly beneficial for many companies. But what is the legal definition of planned obsolescence? Where do we draw the line between a faulty product and one that was intentionally designed to fail, or simply slow down, within a few short years?

If your company has been accused of engaging in this practice, these are some of the questions you might be asking yourself. The first thing you need to realize is that you are not alone. Many other companies have been accused of this misconduct in the past – including major names like Apple. Secondly, you should know that you do not need to simply accept these allegations without putting up a fight in court. A qualified tech lawyer can help you protect your reputation and your financial well-being while avoiding legal penalties associated with planned obsolescence.

Is Planned Obsolescence Illegal in the United States?

 You might be surprised to learn that there are currently zero official laws that prohibit planned obsolescence in the United States. As long as you deliver the product to the specifications as promised, it is a case a caveat emptor, and the Customer is responsible for the appropriateness of the product they select for the job at hand. Although the CPSC sets durability standards for various products, no law specifically mentions this term. That being said, past cases have shown that planned obsolescence may fall under the general classification of fraud. But plaintiffs are only successful if they can prove that the alleged defects or lack of durability were both intentional and concealed. No current court rulings provide a clear precedent when it comes to whether planned obsolescence can be considered fraudulent concealment or computer fraud, according to a recent scholarly article.

Planned Obsolescence in the Tech World

 Planned obsolescence has a long history that dates back many decades. The term was first coined as part of a legitimate strategy to fight the depressionary period of the 1920s and 30s. The logic was that if manufacturers were legally required to build products that would fail or become obsolete within a few years, this would stimulate the economy with high purchase volumes. Planned obsolescence (rebranded as “dynamic obsolescence”) reared its head once again in the 1950s, with GM promoting a strategy of new car models each year. This strategy allowed GM to surpass Ford, as their competitor valued simplicity and economy of scale rather than a constant stream of new models.

In the tech world the size of the operating system, with new much larger software; or the need for new product with expanded chip size etc. all helped to make earlier versions of the product obsolete, but now the focus has moved to power consumption and battery life.

In the tech world, however, the debate over planned obsolescence mostly revolves around batteries. For most modern devices (including phones, tablets, and laptops), batteries are impossible to replace. This means that the product’s lifespan is primarily dictated by the battery rather than the actual surrounding hardware. By replacing batteries, customers risk damaging their products, voiding their warranties, and – in the case of modern phones – ruining waterproof features. Some phones even have special features that make it difficult to open the device and conduct repairs, such as pentalobe screws.

But what happens when you add software into the mix? A clear example is “batterygate.” This term is used to describe the alleged “performance controls” that limit the output of Apple phone batteries. The term “throttling” has also been used to describe this process. This is somewhat unique because it represents both software and hardware working in tandem to allegedly create a system of planned obsolescence. Apple critics argue that they need to incentivize users to constantly upgrade to a new phone each year since this is what their entire business model has essentially become in the modern era.

Is there any truth to this? Apple has denied all of these allegations, although it has also admitted to certain mistakes and battery malfunctions in the past. It also created a discount program in which users could replace their faulty batteries at a lower price – suggesting that they were well aware of the issue. 32 class-action lawsuits have been filed against Apple for this specific issue. French authorities fined Apple 25 million euros in 2020 for their decisions regarding batterygate. The company then agreed to a $500-million settlement in the same year. Later in 2020, Apple agreed to pay the District of Columbia $113 million for the same issue.

On May 8, 2023, it was reported that Apple was facing a similar lawsuit in the United Kingdom. The company was apparently facing a $2-billion lawsuit related to the concealment of defective batteries. The lawsuit makes specific mention of a power management tool, accusing the company of installing this software without anyone’s knowledge. The software “limited performance,” according to the plaintiffs.

Will Apple ever face any real consequences for these actions? You might argue that they already have. After all, they have paid hundreds of millions in settlements to various districts. That being said, these settlements equate to just a handful of dollars for each Apple customer who was affected. You also need to remember these settlements are negligible compared to the total net worth of the company. In addition, there are no laws against planned obsolescence in the United States, so it is very difficult to prove any wrongdoing in this specific situation. Still, tech companies must be aware that this is an increasingly relevant issue across the world – one that may lead to legal consequences.

Where Can I Find a Qualified Tech Lawyer?

 If you have been searching for a qualified tech lawyer, look no further than John P. O’Brien. With plenty of experience with tech law, we are ready to guide your organization toward a positive outcome. Whether you are facing accusations of planned obsolescence, software copyright infringement, or any other tech-related legal issue, we can help. Book your consultation today, and we can discuss the specifics of your situation in detail. From there, we can get started with an action plan catered toward your unique needs. Reach out today.