Apple has agreed to pay $250 million to resolve a class action lawsuit accusing the company of falsely advertising artificial intelligence features on its iPhone, a settlement filed Tuesday in a California federal court confirmed. The deal, which does not require Apple to admit any wrongdoing, will see eligible US customers who purchased an iPhone 15 or iPhone 16 between June 2024 and March 2025 receive between $25 and $95 per device, depending on the number of approved claimants.

The lawsuit centred on Apple's marketing of its "Apple Intelligence" suite of AI features, particularly an upgraded version of Siri, the company's long-standing voice assistant. Lawyers representing the consolidated class of iPhone buyers alleged that Apple promoted capabilities that "did not exist at the time, do not exist now, and will not exist for two or more years, if ever" — framing the campaign as deliberate false advertising designed to drive device sales. Apple had promised to transform Siri from a "limited voice interface into a full-fledged personal AI assistant," a claim plaintiffs say was never delivered upon. According to lawyers, "The iPhone 16 was delivered to consumers without Apple Intelligence, and Enhanced Siri never came."

The broader context is Apple's effort to keep pace in a fast-moving race among major technology companies to integrate AI into consumer products, fuelled in part by the rapid rise of firms such as OpenAI and Anthropic. Apple's outgoing chief executive Tim Cook has faced recurring criticism that the company has been slower to innovate than its rivals, and the Apple Intelligence rollout was seen as a high-profile attempt to signal competitive ambition. An Apple spokeswoman said the lawsuit had focused on "the availability of two additional features" within a much larger set of releases, adding: "We resolved this matter to stay focused on doing what we do best, delivering the most innovative products and services to our users."

The settlement highlights growing scrutiny of how technology companies market AI capabilities to consumers, especially as the gap between promotional claims and real-world performance remains a point of contention across the industry. Regulators and courts are increasingly being asked to define the boundaries between aspirational advertising and outright misrepresentation — a question that is likely to recur as AI becomes central to product launches across the sector.