The United States has fined Apple and Goldman Sachs $89 million for allegedly misleading customers of their co-branded Apple Card and mishandling customer service. The Consumer Financial Protection Bureau (CFPB) accused both companies of failing to address user complaints properly and causing confusion over interest-free payment plans, impacting hundreds of thousands of Apple Card holders since its launch in 2019.
According to the CFPB, Apple did not forward thousands of customer disputes to Goldman Sachs, who also failed to follow federal guidelines in investigating the claims. Furthermore, the companies were found to have misled customers into believing that purchases of Apple products made with the Apple Card would qualify for automatic interest-free payments, resulting in unexpected charges for many.
CFPB Director Rohit Chopra stated that big tech and Wall Street firms are not exempt from federal laws, banning Goldman Sachs from issuing new consumer credit cards until it complies with regulatory standards. The bureau also criticised both companies for launching the Apple Card despite early technological issues, which led to delayed refunds and even damaged some users’ credit scores.
In response, Goldman Sachs and Apple said they had worked to address the issues, while Apple disputed the CFPB’s interpretation of events. Goldman Sachs has been ordered to pay $19.8 million in compensation and a $45 million fine, with Apple receiving a $25 million penalty.
A Florida mother is suing the AI chatbot startup Character.AI, alleging it played a role in her 14-year-old son’s suicide by fostering an unhealthy attachment to a chatbot. Megan Garcia claims her son Sewell became ‘addicted’ to Character.AI and formed an emotional dependency on a chatbot, which allegedly represented itself as a psychotherapist and a romantic partner, contributing to his mental distress.
According to the lawsuit filed in Orlando, Florida, Sewell shared suicidal thoughts with the chatbot, which reportedly reintroduced these themes in later conversations. Garcia argues the platform’s realistic nature and hyper-personalised interactions led her son to isolate himself, suffer from low self-esteem, and ultimately feel unable to live outside of the world the chatbot created.
Character.AI offered condolences and noted it has since implemented additional safety features, such as prompts for users expressing self-harm thoughts, to improve protection for younger users. Garcia’s lawsuit also names Google, alleging it extensively contributed to Character.AI’s development, although Google denies involvement in the product’s creation.
The lawsuit is part of a wider trend of legal claims against tech companies by parents concerned about the impact of online services on teenage mental health. While Character.AI, with an estimated 20 million users, faces unique claims regarding its AI-powered chatbot, other platforms such as TikTok, Instagram, and Facebook are also under scrutiny.
Perplexity has vowed to contest the copyright infringement claims filed by Dow Jones and the New York Post. The California-based AI company denied the accusations in a blog post, calling them misleading. News Corp, owner of both media entities, launched the lawsuit on Monday, accusing Perplexity of extensive illegal copying of its content.
The conflict began after the two publishers allegedly contacted Perplexity in July with concerns over unauthorised use of their work, proposing a licensing agreement. According to Perplexity, the startup replied the same day, but the media companies decided to move forward with legal action instead of continuing discussions.
CEO Aravind Srinivas expressed his surprise over the lawsuit at the WSJ Tech Live event on Wednesday, noting the company had hoped for dialogue instead. He emphasised Perplexity’s commitment to defending itself against what it considers an unwarranted attack.
Perplexity is challenging Google’s dominance in the search engine market by providing summarised information from trusted sources directly through its platform. The case reflects ongoing tensions between publishers and tech firms over the use of copyrighted content for AI development.
Intel has won a significant victory in a legal battle that spanned nearly two decades, as the European Union’s Court of Justice ruled in its favour on Thursday. The court dismissed an appeal by the European Commission, which had accused the US chipmaker of anti-competitive practices aimed at undermining rival Advanced Micro Devices (AMD).
The dispute centred on Intel offering rebates to major computer manufacturers, such as Dell, Hewlett-Packard, NEC, and Lenovo, for primarily using Intel chips. EU regulators had fined Intel €1.06 billion, arguing the rebates were intended to block AMD’s market share. However, Intel consistently challenged the fine, asserting that regulators failed to prove any anti-competitive impact from the rebates.
Earlier this year, Intel’s case gained momentum when a legal adviser indicated that EU regulators had not sufficiently conducted an economic analysis to support their claims. This led to the court’s final decision to overturn the fine, bringing the lengthy legal struggle to a close.
The United States Justice Department introduced new rules on Monday to safeguard federal and personal data from foreign adversaries such as China, Russia, and Iran. The regulations aim to limit certain business transactions that could transfer sensitive American data to these countries.
The proposal implements an executive order from President Biden and seeks to prevent the misuse of American financial, health, and genomic data by foreign governments for purposes like espionage and cyber attacks. Countries such as Venezuela, Cuba, and North Korea are also included in the list of nations targeted by the rule.
Among the data types restricted from transfer are human genomic data on more than 100 individuals, and financial or health data on over 10,000 people. Geolocation data on more than 1,000 US devices will also be restricted under the new rule.
The Justice Department plans to enforce compliance through both civil and criminal penalties. Apps like TikTok could potentially violate the new regulations if they transfer sensitive data to their Chinese parent companies.
Arm Holdings is cancelling a key architectural license agreement with Qualcomm, escalating the legal dispute between the two companies. According to a Bloomberg News report, Arm has given Qualcomm a 60-day notice to terminate the agreement, which allows Qualcomm to design chips using Arm’s intellectual property. The two tech giants have been embroiled in a legal battle since 2022 when Arm sued Qualcomm for not renegotiating the license after its acquisition of chip startup Nuvia.
Qualcomm criticised Arm’s decision, calling it a ‘desperate ploy’ to disrupt the upcoming trial, which is set to begin in December. Qualcomm claims its rights under the agreement will be upheld and accuses Arm of anti-competitive behaviour. The dispute could impact shipments of laptops using Qualcomm’s chips, including Microsoft’s Copilot+ devices, and potentially reverse Qualcomm’s acquisition of Nuvia.
Despite the tensions, some analysts expect the companies to reach a settlement before the trial. A legal victory for Arm could have significant consequences for Qualcomm and its partners.
Australia’s corporate regulator has charged Grant Colthup, the former CEO of Mine Digital, with fraud involving a A$2.2 million transaction. The Australian Securities and Investments Commission (ASIC) claims that a customer paid this amount to ACCE Australia, which operated the crypto exchange, to purchase Bitcoin in July 2022. However, the customer allegedly received no cryptocurrency in return.
ASIC alleges that Colthup used the funds to cover ACCE’s liabilities or acquire cryptocurrency for others. Mine Digital, active from 2019 to 2022, shut down following financial issues. Investigations revealed that the company had only A$20,000 in assets, far below the A$16 million owed to creditors.
The charges come amid ongoing scrutiny of the collapsed exchange and growing concerns over the accountability of cryptocurrency platforms. Colthup’s case sheds light on the challenges of regulating the digital asset sector and ensuring transparency.
The Magistrates Court in Ipswich will hear the case next on 16 December 2024. Legal proceedings are expected to explore Colthup’s role and whether funds were misappropriated to benefit others.
Dow Jones and the New York Post have taken legal action against AI startup Perplexity AI, accusing the company of unlawfully copying their copyrighted content. The lawsuit is part of a wider dispute between publishers and tech companies over the use of news articles and other content without permission to train and operate AI systems.
Perplexity AI, which aims to disrupt the search engine market, assembles information from websites it deems authoritative and presents AI-generated summaries. Publishers claim that Perplexity bypasses their websites, depriving them of advertising and subscription revenue, and undermines the work of journalists.
The lawsuit, filed in the Southern District of New York, argues that Perplexity’s AI generates answers based on a vast database of news articles, often copying content verbatim. News Corp, owner of Dow Jones and the New York Post, is asking the court to block Perplexity’s use of its articles and to destroy any databases containing copyrighted material.
Perplexity has also faced allegations from other media organisations, including Forbes and Wired. While the company has introduced a revenue-sharing programme with some publishers, many news outlets continue to resist, seeking stronger legal protections for their content.
Alcon Entertainment, the producer behind Blade Runner 2049, has filed a lawsuit against Tesla and Warner Bros, accusing them of misusing AI-generated images that resemble scenes from the movie to promote Tesla’s new autonomous cybercab. Filed in California, the lawsuit alleges violations of US copyright law and claims Tesla falsely implied a partnership with Alcon through the use of the imagery.
Alcon stated that it had rejected Warner Bros’ request to use official Blade Runner images for Tesla’s cybercab event on October 10. Despite this, Tesla allegedly proceeded with AI-created visuals that mirrored the film’s style. Alcon is concerned this could confuse its brand partners, especially ahead of its upcoming Blade Runner 2099 series for Amazon Prime.
Though no specific damages were mentioned, Alcon emphasized that it has invested hundreds of millions in the Blade Runner brand and argued that Tesla’s actions had caused substantial financial harm.
A California judge has granted Google’s request to delay a ruling that required overhauling its Play Store by 1 November. The pause allows more time for an appeals court to consider Google’s challenge to the order, which aimed to give users more choice in downloading apps.
The ruling came as part of an antitrust lawsuit from Epic Games, the creator of Fortnite. Google warned that implementing the changes quickly would introduce security risks across the Android ecosystem. The company’s request for a longer pause during the full appeals process was denied.
Epic criticised Google’s argument as fearmongering, stating the court had dismissed the appeal as meritless. The initial order required Google to permit rival app stores within the Play Store and enable third-party payment systems. The ruling also barred Google from incentivising device makers to preinstall its store.
Google has already challenged the antitrust findings and maintains that Play competes directly with Apple’s App Store. The company argued it should not be labelled a monopolist and warned that complying with the injunction would unfairly force it to collaborate with rivals.
