Supreme Court Allows Class-action Against Apple Over iPhone Apps to Proceed

Supreme Court Allows Class-action Against Apple Over iPhone Apps to Proceed

Supreme Court Allows Class-action Against Apple Over iPhone Apps to Proceed

The US Supreme Court on Monday ruled that a case challenging Apple's monopolistic grip over its official App Store can proceed.

In a 5-4 decision, the Supreme Court ruled that Apple application buyers could sue the company over its inflated app prices. That suit will focus on Apple's rules that developers must sell their apps through its app marketplace, in addition to paying a 30 percent commission to Apple. The Supreme Court is allowing consumers to pursue an antitrust lawsuit that claims Apple has unfairly monopolized the market for the sale of iPhone apps. Earlier this year, Spotify filed a complaint with European regulators claiming that Apple uses its (monopoly) power over the app store to hurt competitors.

"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, who was recently appointed to the bench by President Donald Trump, wrote in the court's opinion. This is not a claim without merit, as the New York Times found that Apple has indeed manipulated the app store to remove or restrict screen time and parental control apps.

Today's ruling, Gorsuch said, could begin whittling away the decision in Illinois Brick and may also call other, older cases into question.

To counter the iPhone sales drop, Apple is trying to make more money from selling services such as its music subscription service, as well as a forthcoming Netflix-like video service while also taking a cut from the subscriptions and other transactions done on apps downloaded on iPhones and iPads. Democratic presidential candidate Elizabeth Warren has argued that big firms such as Facebook, Google and Apple should be broken up through antitrust enforcement. Apple argued the consumers were indirect purchasers, because any overcharge would be passed on to them by developers.

The lawsuit could have major implications for the tech giant's handling of the more than 2 million apps in Apple's App Store, where users get much of the software for their smartphones. This is the scenario that some pundits think is most likely, as it would satisfy some critics without fundamentally changing how Apple monetizes apps. "But Apple asserts that the iOS users, in this case, may not sue Apple because they supposedly were not "direct purchasers", writes Kavanaugh.

Apple had contended only app developers should be able to bring forward such litigation.

"To evade the court's test, all Apple must do is amend its contracts", Gorsuch wrote.

The best example of the unusual app market dynamics came when the makers of mega-game Fortnite, Epic, decided not to launch its game app through the Google Play store because it didn't want to pay the 30 per cent tax.

Specifically, the US Supreme Court has told consumers to go ahead with their lawsuits against the company from Cupertino.

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