The Australian Competition and Consumer Commission (ACCC) told the Federal Court that the US tech giant Apple had agreed to pay a $2.25 million settlement on Friday for allegedly misbranding its third-generation iPads in Australia's online store, according to the Apple news blog 9to5Mac.

Apple offered in March to refund Australian customers who felt they had been misled by the "iPad with WiFi + 4G" promotion and publish a clarification about the popular tablet's capabilities after the ACCC took it to court.

The ACCC took apple to court in March for using the moniker "4G" to describe iPads that were able to connect to mobile networks, even though the 4G frequencies that the iPad uses don't work on current Australian long term evolution (LTE) 4G networks, said ZDNet

"The ACCC alleges that Apple's recent promotion of the new 'iPad with WiFi + 4G' is misleading because it represents to Australian consumers that the product 'iPad with WiFi + 4G' can, with a SIM card, connect to a 4G mobile data network in Australia, when this is not the case," the ACCC wrote in a statement in March.

Though the iPad's 4G function only works on networks in the United States and Canada it had been widely promoted as one of the tablet's features globally, which the ACCC said amounted to false advertising.

It is now advertised outside North America as "Wi-Fi + Cellular", with a clear caveat on its Australian site that "it is not compatible with current Australian 4G LTE networks and WiMax networks."