Lawsuit: AT&T Says ‘Tough Luck’ on iPhone MMS

Apple and AT&T are facing another class-action lawsuit claiming the two companies falsely represented the iPhone’s ability to support MMS messaging.

Multimedia Message Service is a standard way to transmit graphics, video clips, audio files and short text messages over wireless networks.

The suit, filed this week in an Ohio district court, alleges that the two companies were deceptive in promoting MMS as a feature on the iPhone 3GS.

Apple (NASDAQ: AAPL) launched the iPhone 3GS on June 16, with MMS as one of the new features that was not included in the older 3G model. Upon the release of the updated iPhone operating system, version 3.0, which came out June 17, both models were supposed to be able to send and receive MMS content.

But AT&T (NYSE: T), the exclusive U.S. carrier for the iPhone, said it doesn’t currently support MMS, though it aims to do so “by the end of summer.”

The new lawsuit follows a similar class-action proceeding recently filed in Louisiana over the MMS issue

The Ohio suit claims AT&T and Apple misrepresented the iPhone MMS feature ability, charging the two companies with a breach of contract and violations of the Ohio Consumer Sales Practices Act and the Deceptive Trade Practices Act.

“Millions of customers, as a result of the false and deceptive representations and concealments of Apple and AT&T, purchased the 3G and 3GS, waiting for the wonderful day in June 2009 when the new application would be available which would allow MMS. Unfortunately, after downloading the new 3.0 Software Update application, MMS still did not work on both the 3G and 3GS,” the lawsuit alleges.

“Incredibly, AT&T was directing customers interested in MMS to go to a computer to view the message,” it said, concluding that “the ‘Fix’ was essentially to say ‘tough luck.'”

AT&T and Apple did not immediately respond to calls seeking comment on the lawsuit.

The suit additionally claims that AT&T is not equipped to support MMS, and therefore should have had prior knowledge of the incompatibility. A troubleshooting section on Apple’s Web site offered consumers little help.

“Clicking on North America, and viewing the graph for USA, under the heading ‘AT&T’ it shows that AT&T is NOT a carrier which offers MMS. Of course, AT&T is the ONLY carrier in the United States used by the iPhone,” the lawsuit noted.

“In other words, AT&T’s towers do not support MMS,” it said, citing a news report that quoted an AT&T spokesman admitting as much. It claims that calls to Apple’s customer support line confirm that “AT&T has never upgraded its towers so as to support the functionality necessary for MMS. Therefore, the iPhone cannot offer MMS as claimed.”

The MMS litigation comes at a time when Apple and AT&T are also trying to assuage iPhone owners over the carrier’s inability to support another iPhone feature, tethering, which is designed to connect the device to a computer or notebook.

Controversy also erupted when AT&T unveiled details of its pricing plan for upgrading the iPhone, with the company eventually relenting to consumer backlash and offering an alternative for current iPhone users who qualified.

Additionally, customers trying to activate their new phones after launch experienced long delays, prompting Apple issue an apology and offer disgruntled users credits to the iTunes music store.

Meanwhile, AT&T, in the face of criticism for its spotty coverage, also tried to placate iPhone owners with capital expenditures aimed at increasing data speeds and improving dropped-call rates in metropolitan areas.

The two companies are also the subject of federal government inquiries into the role of exclusive carrier partnerships and how those impact industry competition and services provided to consumers.

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