Supreme Court rules against Apple, allowing lawsuit targeting App Store to proceed

Supreme Court rules Apple will face antitrust suit for its iPhone apps

"Apple's alleged anticompetitive conduct may leave Apple subject to multiple suits by different plaintiffs", the Court noted in its ruling.

The Supreme Court ruled Monday (May 13) that an antitrust lawsuit against Apple can proceed, which may spell the end of Apple's 30% commission on third-party apps.

"It is undisputed that the iPhone owners bought the apps directly from Apple", Kavanaugh wrote.

Apple v Pepper, as the case is called, dealt with the issue of whether Apple's 30 percent revenue cut is a charge that trickles down to consumers.

Apple sought to block the lawsuit, asserting that it had not set the prices on the apps and thus the iPhone owners had no standing to sue.

But now the antitrust lawsuit can go ahead, which could have ramifications for other tech companies who offer platforms for services.

"In the retail context, the price charged by a retailer to a consumer is often a result (at least in part) of the price charged by the manufacturer or supplier to the retailer, or of negotiations between the manufacturer or supplier and the retailer", Kavanaugh wrote.

"Amazon was likely rooting for Apple to win this", Singer said. The company did not immediately respond to an AFP query on the court decision.

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The court did not rule on the plaintiff's merits, but the matter can now be litigated in District Court.

"We all have apps on our phones: some for free and some you buy from Apple". I suppose Apple's defense now could be that consumers already have a choice when it comes to where to buy apps: if you don't like it, you can always jump ship to Android. "That is why we have antitrust law", the newest Justice sitting on the Supreme Court wrote. Apple previously claimed that it was just an intermediary for purchases, but the Supreme Court ruled otherwise.

It's fair to say that the real problem isn't so much that Apple charges a commission but that it charges a massive 30 per cent.

Justice Brett Kavanaugh, appointed by President Trump previous year, wrote the decision for himself and the court's four liberal justices.

Antitrust experts also welcomed the Court's reasoning that allowing Apple to avoid the class-action suit "would provide a roadmap" for others to evade the law.

It is worth noting that neither side really dug into the realities of app stores and digital marketplaces, relying instead on precedents about bricks and shoes (Hanover Shoe v United Shoe Machinery, 1968) to make their case.

President Donald Trump (left) shakes hands with Supreme Court Justice Brett Kavanaugh (right) before delivering the State of the Union address at the Capitol in Washington, D.C., on February 5.

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