Apple has been sued for $1m in New York following the company’s decision to cut the price of the iPhone last month by $200.

The woman suing Apple - Dongmei Li - isn't just angry, she says that Apple broke several laws when it cut the price of the iPhone by one-third. Li is accusing AT&T, Apple and Steve Jobs of price discrimination, discrimination in offering rebates versus credits, unfair and deceptive practices and underselling.

In early September, Apple dropped the price of its 8GB iPhone in the US by $200, while dropping the 4GB model altogether. 24 hours later Apple CEO Steve Jobs apologised to the company's customers and offered earlier buyers a $100 in-store credit.

Filed in New York federal court, Li said that early purchasers were harmed because they cannot resell their iPhones for the same profit as later purchasers. Li purchased the 4GB iPhone and she accuses Apple of abandoning that model and locking customers into a two-year deal with AT&T.

Spokespeople for Apple and AT&T were not immediately available for comment.