Apple will pony up as much as $53 million to settle a class-action law suit alleging the company unfairly denied warranty coverage to some iPhone and iPod touch customers.

The suit, which dates back to 2010, stems from allegations that some owners could not get a device replaced or repaired under warranty because Apple claimed the devices had been damaged by the owners. An indicator inside the devices was supposed to change color if they had been submerged in water but the manufacturer of the indicator, 3M, later indicated that heat could also have caused the change in color.

?To Apple's bottom line, this is a drop in the bucket,? said Steve Timpson, chief operating officer of Siteminis, Atlanta.

?However, Apple has had a history of denying warranty issues that go back to the first several versions of the iPod and battery issues that were ultimately settled as a class action," he said.

?Based on previous history with class action settlements and Apple, there will probably be little impact on the brand or its position in the market. In fact, I will not be surprised if the overall cost to Apple is less than $53 million as not everyone will necessarily make the effort to collect. ?

Liquid indicator
The settlement still needs to be approved by the court. If it is approved, the $53 million will be distributed among the 153,000 consumers named in the suit.

The suit members had all purchased the original iPhone, iPhone 3G, iPhone 3GS or one of the first three generations of iPod touches and had one- or two-year warranties but were unsuccessful in getting their device repaired or replaced under warranty.

Documents filed as part of the proceedings reveal that Apple had a policy in place for denying warranty coverage if the liquid indicator inside one of the devices had changed color.

Individual payouts could be around $200, depending upon how many make claims.

The suit was filed in the U.S. District Court for the Northern District of California.

More warranty problems
Apple?s warranty policies also came under fire in China recently. The company was accused of treating customers in that country differently from those in other countries, with Apple repairing broken or faulty parts on its devices for Chinese customers while providing replacement devices for customers elsewhere.

China is crucial to Apple?s future growth as iPhone growth rates in the United States and elsewhere begin to slow down slightly.

Long the darling of the smartphone category, Apple has begun to reveal some chinks in its armor as competition intensifies and consumer satisfaction weakens slightly.

?Overall the best way to handle a manufacturing warranty issue is to get on top and ahead of the curve to keep customers happy,? Mr. Timpson said.

Final Take
Chantal Tode is associate editor on Mobile Marketer, New York