Economy

Supreme Court rules that consumers can sue Apple for App Store practices

A dissenting opinion written by Justice Neil Gorsuch and joined by other conservatives on the court agreed with Apple´s argument that developers, not the company, sell to consumers and that the lawsuit is based on "pass-on" liability.

Apple's store is far from the only one that takes a cut from developers.

Apple shares were trading down $10 at 187.04 by midday. He also addressed Apple's claim that they do not set app prices by pointing out that the company's practice of charging app developers $99 per year plus 30 percent of sales indeed affects pricing.

Interested in Supreme Court? "We merely hold that the Illinois Brick direct-purchaser rule does not bar these plaintiffs from suing Apple under the antitrust laws". "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". The consumers' complaint against Apple is the kind of case earlier high court rulings said was not allowed under federal laws that prohibit unfair control of a market, Gorsuch wrote.

Mark Rifkin, a lawyer representing the plaintiffs, said he was gratified by the court's decision, which "reaffirmed the straightforward principle that consumers who purchase a monopolized product directly from the alleged monopolist may sue the monopolist to recover the full amount of the overcharge they are forced to pay by reason of the monopoly".

Apple did not immediately respond to a request for comment on the ruling.

iPhone owners filed a class-action lawsuit against Apple back in 2011. They were supported by 30 state attorneys general, including from Texas, California and NY. The case, Apple v. Pepper, was actually dismissed in 2013 by a California court, but the Court of Appeals for the Ninth Circuit allowed it to return in 2017.

A district court decision had said that the iPhone users did not have standing to bring their antitrust claim because the developers - not Apple - are the ones selling the apps.



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