Nicholas Arthur Woodhams used a warranty scheme Apple out of 9,075 iPod Shuffle devices. Woodhams then began to sell the devices over the Internet for $49 each. The retail price for the Shuffle is about $79. The complaint filed against Woodhams was made in the U.S. District Court in Grand Rapids. Woodhams was charged with mail fraud and money laundering.
Woodhams ran an iPod repair business. He changed around his business several times to “iPod Mechanic,” “iMechanic,” and “Pod Tradeup.” Woodhams lives in Kalamazoo, Michigan.
Woodhams guessed valid serial numbers of iPod Shuffles that were under warranty and had Apple send replacement products. specific digits that correspond with the model, color, and several other features.
Apple’s return policy requests the defective gadget back from the consumer. Woodhams got around this by setting up prepaid VISA gift cards and a UPS store mailbox. VISA would reject the charge requests made by Apple rather than having to send the company any defective units.