My parents don't need fancy phone and are happy with the phones they already have. So I sold upgrade iPhone 4 on eBay. In the listing I indicated that the phone was contract free but AT&T locked. When the buyer got the unopened iPhone he was anticipating that the phone (being contract free) will be already activated. In other words the phone will not be stuck at "Emergency Dial Screen". When he inserted SIM that came with the phone, he naturally saw my parent's phone number in iTunes activation window. At that point he was convinced that the phone itself is somehow locked to my account and there was no way for him to activate and use it. Now, here's the thing, I know that if he had active AT&T account SIM, he should have no problem activating his phone. I doubt that he has AT&T account. Otherwise, why whould he buy this phone for more than it costs to buy contract-free iPhone at AT&T store? His intention was to jailbreak and unlock the phone and use it overseas. Anyway, my question is: are contract free iPhones any different than regular upgrade iPhones? Is there such thing as account locked iPhone?