Parents May Get Refunds in Game Currency Suit

SAN JOSE, Calif. (CN) - A federal judge will hold a hearing Friday on Apple's unopposed offer to refund parents whose children made unauthorized iTunes purchases.

The consolidated class action arose after several parents received iTunes bills for purchases their children had made while using applications on their Apple devices.

Garn Meguerian filed the first of the complaints in April 2011, claiming that Apple made "millions of dollars of ill-gotten gains" by selling game currency to children via so-called "free" apps.

Apple requires a password to download applications and buy game currency through its devices and retail outlets, but a user has 15 minutes to buy stuff once the password is entered before being prompted again, according to Meguerian's complaint.

"This practice enabled minors to buy Game Currency, in one click sums of $99.99 or more, without entering a password, causing Apple to pocket millions of dollars from such Game Currency transactions with minors and without the authorization of their parents, whose credit cards or PayPal accounts are automatically charged for the purchases," according to the complaint.

Though Apple began requiring the entry of a password for all individual transactions in early 2011, and warning users that "free" games may contain in-app content for sale, Apple allegedly continued selling Game Currency to minors.

One of the games at issue was "Smurfs' Village," according to the complaint. The alleged purpose of the game is to create a "virtual village," and "the construction process is greatly sped up by the purchase of 'Smurfberries,' Game Currency that costs real money."

The complaint cited a news story that reported on one "young gamer" who spent $1,400 on Smurfs currency.

Meguerian's 9-year old daughter allegedly bought $200 worth of game currency to play "free" games, including "Zombie Café," "Treasury Story" and "City Story."

He and the other lead plaintiffs asked the court last week to approve a settlement that requires Apple to provide $5 iTunes credits to class members who claim a minor bought in-game items without their knowledge or permission. If a child spent more than $5, Apple will offer a credit for that amount. A cash refund will be offered in lieu of iTunes credit if the amount a child spent tops $30.

If approved, the settlement could result in Apple issuing refunds to more 23 million iTunes users who made purchases within one or more of the qualifying games.

U.S. District Judge Edward Davila will consider the motion Friday morning.

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