Supreme Court Rules Apple Anti-Trust Lawsuits May Move Forward

Andrew Cummings
May 13, 2019

In response, Apple pointed to decades-old Supreme Court precedent that found only the "direct purchasers" of a service are eligible to bring such an antitrust lawsuit in the first place. A judge could triple the compensation to consumers under antitrust law if Apple ultimately loses the suit. Apple also claimed that because they don't set the retail price of the apps on the store, iPhone users can not sue them. The majority decision was reached by Justice Brett Kavanaugh, joined by Justices Ruth Bader Ginsburg, Stephen Breyer, Sonia Sotomayor, and Elena Kagan.

Apple posits that allowing only the upstream app developers - and not the downstream consumers - to sue Apple would mean more effective antitrust enforcement.

iPhone owners filed a class-action lawsuit against Apple back in 2011.

According to statistics portal Statista, US customers spent $46.6bn (£36bn) on a combination of in-app purchases, subscription and premium apps in 2018. The suit charges Apple with gouging consumers through what it describes as a monopoly on apps in the App Store.

Apple, which was also backed by the U.S. Chamber of Commerce business group, had sought to dismiss the case, arguing that the plaintiffs lacked the required legal standing to bring the lawsuit.

'.Apple's line-drawing does not make a lot of sense, other than as a way to gerrymander Apple out of this and similar lawsuits'. Apple had argued that a Supreme Court ruling allowing the case to proceed could pose a threat to e-commerce, a rapidly expanding segment of the USA economy worth hundreds of billions of dollars in annual sales.

At the heart of the case is Apple's handling of iPhone and iPad apps created by third-party developers and made available on its heavily curated App Store.

Some of the justices initially seemed skeptical of Apple's claims.

When an application is purchased, Apple collects a 30 percent commission and gives the other 70 percent to the developer. They were supported by 30 state attorneys general, including from Texas, California and NY.

The Supreme Court, in a 5-4 ruling, upheld a Ninth Circuit decision concluding that the iPhone owners were direct purchasers because they bought their apps directly from Apple.

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