U.S. Supreme Court Allows App Store Monopoly Lawsuit to Proceed
The United States Supreme Court is allowing an antitrust lawsuit against Apple to proceed.
According to a new report from CNBC, the United States Supreme Court ruled Monday that a group of iPhone users can move forward with their suit against Apple over allegations the company has built an illegal monopoly on the sale of applications for the smartphone.
The justices, in a 5-4 ruling, upheld a lower court’s decision to allow the proposed class action lawsuit to proceed. The plaintiffs said the Cupertino, California-based company required apps to be sold through its App Store and extracted an excessive 30% commission on purchases.
“Apple’s alleged anticompetitive conduct may leave Apple subject to multiple suits by different plaintiffs,” the Court noted in its ruling.
Apple does not allow customers to download apps from any other source other than the App Store. Unlike Android, iOS customers can only get apps from that official source, which Apple says serves as a kind of quality control to weed out security threats and apps that violate the company’s terms of service.
Conservative Justice Brett Kavanaugh, an appointee of President Donald Trump, joined the court’s four liberal justices to rule against Apple.
“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,” Kavanaugh wrote, rejecting Apple’s defense. “In particular, we fail to see why the form of the upstream arrangement between the manufacturer or supplier and the retailer should determine whether a monopolistic retailer can be sued by a downstream consumer who has purchased a good or service directly from the retailer and has paid a higher-than-competitive price because of the retailer’s unlawful monopolistic conduct. As the Court of Appeals aptly stated, ‘the distinction between a markup and a commission is immaterial.'”
The Supreme Court did not rule on the customers’ likelihood of success — only that they have the right to sue. Apple argued that it was not a monopoly, rather a platform for app developers who can set their own prices. It has said that if the court allowed the case to proceed, it could potentially disrupt the e-commerce market. For Apple, hundreds of millions of dollars in penalties could hang on the outcome.