Apple sues recycling company for reselling products instead

If you sent an iPhone, iPad, or Apple Watch to Apple for recycling between 2015 and 2017, you might actually have been part of “reuse” in the “reduce, reuse, recycle” cycle.

That’s good, right? Nope, says Apple. The tech giant had been paying the company GEEP Canada to take apart and salvage materials from its devices sent for recycling. But according to a lawsuit by Apple Canada, GEEP Canada actually refurbished and resold more than 100,000 devices it had been paid to dismantle.

“At least 11,766 pounds of Apple devices left GEEP’s premises without being destroyed – a fact that GEEP itself confirmed,” Apple says in its complaint, as reported by The Verge.

The recycling firm denies wrongdoing and has filed a third-party suit that says “theft happened” but it’s not on them because it was 3 “rogue” employees who stole and sold the devices for themselves, not for the company. They want those employees to pay, alleging that they hurt the company’s business. However, Apple says, those 3 employees were actually senior management.

How did Apple find out? During an audit at GEEP Canada’s Ontario warehouse, Apple found its devices were being stored in an area not covered by security cameras, according to Apple Insider (via The Logic). Of the roughly 575,000 iPhones, iPads, and Apple Watches it had sent GEEP between January 2015 and December 2017, 18% were being used on a telecom carrier network. That doesn’t include wi-fi only devices, so the actual number could be much higher.

It’s not just paying for services and materials they did not receive that upset Apple. Resales of refurbished devices hurt demand for new products, created potential safety issues for consumers, and damaged its brand, the suit alleges, according to The Logic. The company is asking for roughly $22.7 million in addition to the money GEEP made from resales. GEEP wants the employees to pay, alleging that they hurt the company’s business. GEEP is now part of Quantum Lifecycle Partners, which says they have nothing to do with all this.

Could/should these devices have been refurbished? “Products sent for recycling are no longer adequate to sell to consumers and if they are rebuilt with counterfeit parts they could cause serious safety issues, including electrical or battery defects,” Apple told The Verge.

Paying a company for recycling services they aren’t, in fact, providing is generally a reasonable basis for a lawsuit. But this case is also likely to draw more attention to the “right-to-repair” movement, which accuses Apple of restricting third-party repair shops. Activists are pushing Apple to focus on reuse over recycling, and the issue has been under review by the US House Judiciary Committee as part of an antitrust investigation of Apple, Amazon, Facebook, and Google-parent Alphabet.