Settlement Preliminarily Approved in|Apple & Best Buy Gift Card Class Action

SAN FRANCISCO (CN) - A federal judge approved settlement of a class action accusing Apple and Best Buy of deactivating iTunes gift cards before they were redeemed, without issuing refunds.

U.S. District Judge Claudia Wilken found the settlement fair and reasonable, in a 7-page preliminary order approving the settlement and settlement class.

Wilken wrote "that there is reasonable cause to submit the proposed settlement agreement to settlement class members and to hold a hearing concerning final approval of the proposed settlement, and ultimately approve the settlement."

A hearing will determine if a class should be certified consisting of all U.S. residents who bought iTunes gift cards between Sept. 1, 2007 and Dec. 31, 2009 that were deactivated between Aug. 1 and Oct. 31, 2010 and not redeemed by the cardholder.

Lead plaintiff Barbara Fafard claimed that the gift cards did not list an expiration date and that neither Best Buy nor Apple informed customers of one.

Co-defendant InComm Holdings provided activation and deactivation services for the gift cards.

"Neither Best Buy nor Apple provides the purchaser with any reasons why, or an example of any circumstance under which, a gift card would be deactivated after purchase," the complaint stated.

Fafard said she received gift cards from her daughter, but the cards were canceled less than a year after purchase.

"Apple made it clear to plaintiff that Apple had not canceled the gift cards, but rather the gift cards had been cancelled by Best Buy ... and that Apple would not accept the gift cards," the complaint stated.

Wilken appointed Marcus & Auerbach LLC of Jenkintown, Penn., and Kershaw Cutter & Ratinoff LLP of Sacramento as class counsel.

Defendants are represented by David Michael Walsh of Morrison & Foerster and Matthew McKenna Wrenshall of Reed Smith LLP in Los Angeles.

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