By Zach Spear

Published: 05:50 PM EST (02:50 PM PST)

Still one more class-action lawsuit is claiming that the iPhone not only fails to live up to 3G speeds, but that it also prematurely develops hairline cracks in its outer casing.

Texas residents Alyce R. Payne, William French, Karen Michaels, and Lorna Harris filed the lengthy 23-page complaint in an Eastern Texas court yesterday on their own behalf as well as all customers who are not satisfied with their iPhone 3G purchase, claiming that Apple has committed breaches of contract and warranty, violating Texas business and commerce codes, and other infractions.

The suit is the second to be filed this week (among many others over the past several months) claiming the iPhone 3G performs poorly when connected via 3G because it "demand(s) too much power from the 3G bandwidths."

The plaintiffs also blame AT&T's infrastructure and name the exclusive carrier of the Apple-built smartphone as a co-defendant, claiming AT&T's system can't cope with the "overwhelming 3G signal" of the sheer number of iPhones sold.

They cite an Associated Press article on tests by Swedish engineering weekly Ny Teknik that concluded some handsets aren't sensitive enough to 3G signals and boost their signals to compensate, creating the network conflict. Subsequent tests, however, showed no hardware issue and instead suggested it was a network congestion issue.

Unusually, the suit cites as proof of poor 3G performance the August 2008 ruling in the United Kingdom requiring Apple to stop advertising the iPhone's ability to access "all parts of the Internet." However, that ruling did not consider 3G speeds, dealing instead with the iPhone's lack of Java and Flash support. Nonetheless, the UK court's decision is cited as an example of the iPhone not functioning properly "on the 3G network."

A Wired blog post is also part of the plaintiffs' evidence, quoting AT&T spokesman Brad Mays as saying iPhones were "performing great" even at the height of reported slowdowns and connection drops.

However, besides these typical claims, the suit is rare in alleging faulty manufacturing of the exterior plastic case.

"The iPhones have had well-known and documented issues regarding the premature 'wear-and-tear' of the iPhones' housing," the complaint says, "including the formation of hairline cracks in the iPhones' casing."

Although these issues weren't an issue with the original iPhone, which came with an aluminum backing, the iPhone 3G comes with a black or white hard plastic back that, just after launch, had triggered multiple complaints of stress around key points of the handsets. According to the lawsuit, cracks form "around the camera, near the volume rocker," and in other areas reported by users.

The company is believed to have knowingly shipped phones with the flaw even after it became an apparent problem. The suit spends several pages reproducing anonymous comments from Apple's forums and various other websites to show when the complaints first surfaced.

"I should've stuck to my old iPhone, the one with the aluminum back that probably wont crack," an Engadget reader comments. "I've never doubted the build quality of Apple products before but now I'm beginning to question it heavily."

Moreover, hardware defects aren't the only problems mentioned in the complaint. The plaintiffs list a raft of problems caused by the iPhone 2.0 software update and the subsequent 2.1 update, which they claim did not fix the original problems of "crashes, 'bricked' handsets, slower applications, a lag in the virtual keyboard, internet connection issues, and spotty call reception."

And while Apple itself positioned iPhone 2.1 as a fix for these key problems, the individuals filing the suit point to reports where many of the problems either weren't immediately fixed or had even "gotten worse" after the update. iPhone 2.2 has since appeared.

One of AppleInsider's own August 2008 reports is also presented as evidence that Apple was aware it had released a tarnished product. A personal email to a customer from Apple chief executive Steve Jobs acknowledged a bug and that a fix was enroute.

The representatives in the class are demanding typical damages but, if victorious, would also require Apple and AT&T to give up any profits earned by way of "misleading" advertising and post a disclaimer on the iPhone's packaging as well as all advertising materials. They are suing for at least $5 million, the established threshold under legal statutes.