Apple accused of monopoly again: this time for its App Store

Apple accused of monopoly again: this time for its App Store

The US Supreme Court will look into the class action suit against Apple on 3 December, Reuters reported.

Apple's lawyers rely on a long-standing court doctrine that holds only "direct purchasers" may bring an antitrust claim.

Plaintiffs acting on behalf of iPhone customers argued that because Apple chooses what apps can be sold, gives developers a limited pricing structure and forces iPhone owners to use the App Store, it is operating anti-competitively.

Justices Neil Gorsuch and Samuel Alito raised the issue that app developers, reliant on Apple for sales, would be reluctant to sue over inflated prices.

Only Chief Justice John Roberts suggested clear support for Apple.

The plaintiffs argue that Apple's developers would be unable to sue Apple due to the firm controlling their means of revenue, which leaves the consumers as the only one who can challenge the firm in court.

Whether or not Apple has a monopoly over the App Store it invented is not the subject of the dispute.




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?

'Apple is a sales and distribution agent for developers, ' Apple's lawyers said in a Supreme Court filing. Such a move would certainly compromise the security of iPhones and iPads though. The solicitor general spoke in favor of Apple's position for the government as the Trump administration has taken the company's side.

Although the case began in 2011, the Supremes are considering a ruling made four years ago by the Northern California US District Court. A key question: Who's responsible for any overcharging - the developers, who set the price, or Apple, which levies a commission on every app sold? However, the plaintiffs are backed by the attorneys general of 30 states including California, Texas, Florida and NY.

If the justices permit the suit to go forward, a decision against Apple would nearly certainly be a blow to its business.

"The Ninth Circuit is home to a disproportionate share of the nation's e-commerce companies, and its erroneous decision creates uncertainty and a lack of uniformity about the proper application of Section 4 (awarding treble damages based on the antitrust law) to this increasingly common business model", it said. Apple is "trying to make it harder for injured parties to assert their rights under federal antitrust law", said Mark Rifkin, an attorney for the plaintiffs. A judge initially threw out the suit, ruling that the consumers were not direct purchasers because the higher fees they paid were passed on to them by the developers. An appeals court reversed the dismissal in 2017, leading to the Supreme Court taking up the matter.

But the San Francisco-based 9th U.S. Circuit Court of Appeals revived the case previous year, finding that Apple was a distributor that sold iPhone apps directly to consumers.

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