Berlin court's Apple ruling highlights issue facing UK and US businesses operating in Germany, says expert

The regional court in Berlin assessed the wording of technology giant Apple's device manufacturer's warranty agreement and its consumer care protection plan and declared 16 clauses in the contracts to be invalid.

Munich-based technology law expert Igor Barabash of Pinsent Masons, the law firm behind Out-Law.com, said the judgment would be "particularly relevant to many US and UK companies that enter the German market using globally standardised contract terms".

"The ruling states that Apple is to discontinue to use certain, or identical, clauses immediately," Barabash said. "In the event Apple does not oblige, Apple is to pay a fine of up to €250k for every violation."

In the case, brought by German consumer protection bodies against Apple, the Berlin court found problems with the transparency of Apple's contract clauses. It found some of the clauses did not allow consumers to "assert and evaluate the limitations of the liability assumed under the Apple warranty", Barabash said.

The court also said there were inconsistencies with the information displayed on Apple's website and that this might mislead consumers into believing that the terms of the Apple warranty would override the statutory warranty rights they enjoy in Germany.

In its warranty agreement, Apple had set out provisions which limited its liability for matters such as duplicate claims and hidden defects. However, Apple used wording to state that its limited liability was qualified to the extent permitted by law. In its ruling, the Berlin court said that because consumers could not be expected to know what the limits of Apple's liability would be, those provisions were invalid.

Barabash said the court had also invalidated clauses on the grounds that Apple had referred to the application of local laws without specifying which country's laws it meant.

Apple's attempts to limit its liability to cases involving 'normal use' of its devices was also rejected on the basis that Apple had failed to be sufficiently explain what would constitute such 'normal use'.

One clause that was deemed invalid concerned Apple's attempt to limit its liability for scratches and other external damage caused to its devices. The Berlin court said, though, that such damage might be caused by manufacturing defects and that Apple could not exclude itself from liability for such defects.