US Supreme Court to hear class action against Apple in early Dec

29 November, 2018, 07:23 | Author: Camille Rivera
  • Apple approaches US Supreme Court to block customers from suing it for monopoly abuse

Apple denies the claims and wants the Supreme Court to dismiss the case, arguing that it does not technically sell the apps and the problem lies with developers. The class-action lawsuit in question accuses Apple of violating antitrust laws by monopolizing the market for iPhone apps and jacking up prices for those apps. Apple brought in an estimated $11 billion in revenue during 2017 from the App Store thanks to that 30 percent cut, with developers taking home the remaining 70 percent.

Apple appealed that decision to the Supreme Court, who today heard the arguments (PDF) as it decides whether to hear the case.

The Supreme Court is considering whether Apple's App Store is a monopoly and if consumers can sue the company over it.

The justices are involved because they have to settle a broader question: Can consumers even sue for damages in an antitrust case like this one?

Tens of thousands of software developers set the prices and agree to pay Apple a 30 percent commission on whatever they sell, the lawyer representing Apple said in the courtroom.

Apple and its tech-industry allies say a decision allowing the consumer lawsuit could open other companies that run online marketplaces and platforms to expensive antitrust claims.

A ruling from the Supreme Court is expected to come in June 2019.




The app store is "really unique", said Mark Rifkin, one of the lawyers pressing the suit. When software developers offer their products, Apple reviews them for compatibility and malware and, once they are approved, charges the developer a 30 percent commission.

In an hour-long oral argument session this morning, though, some justices seemed to take a skeptical line. "From my perspective", she said, "I've engaged in a one-step transaction with Apple".

The arguments dealt with the fruits of technology that, over the past 10 years, have made more than 2 million apps available to iPhone users, but in the courtroom there were also references to older antitrust cases involving concrete, aluminum, natural gas and shoes. The Trump administration is backing Apple at the high court.

The suit, filed in federal court in Oakland, California, seeks class-action status and potentially hundreds of millions of dollars. At that time, Judge Yvonne Rogers ruled in favor (PDF) of Apple, reasoning that end users of the applications were indirect customers are therefore could not be the ones to sue under U.S. antitrust law.

"As a result, iPhone owners paid Apple more for apps than they would have paid in a competitive retail market".

A federal district judge initially ruled in Apple's favor, but a panel of the U.S. Court of Appeals for the 9th Circuit in San Francisco overruled that decision past year and held that consumers were direct purchasers of iPhone apps.

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