US Supreme Court greenlights lawsuit over App Store monopoly

US Supreme Court greenlights lawsuit over App Store monopoly

US Supreme Court greenlights lawsuit over App Store monopoly

Apple and its tech-industry allies said before the ruling that a decision allowing the lawsuit could lead to expensive antitrust claims against other companies that run online marketplaces, potentially affecting Alphabet Inc.'s Google, Amazon.com Inc. and Facebook Inc.

Apple suffered a significant defeat at the Supreme Court on Monday, when the justices ruled that consumers could forge ahead with a lawsuit against the iPhone giant over the way it manages its App Store.

The suit, filed by leading plaintiff Robert Pepper, dates back to 2011.

Apple has argued that they are not a monopoly as consumers could always purchase apps from other app stores by buying another device, a somewhat ridiculous position.

Apple keeps 30% of the sales price, where it is set, Kavanaugh said in a summary he read from the bench. A practical problem with Apple's theory, wrote Kavanaugh, is that it could give "monopolistic retailers" a way to avoid being sued under antitrust law: They could simply arrange their transactions to be commissioned sales on behalf of manufacturers rather than direct sales of items they bought at wholesale, he argued.

The Cupertino, California-based technology company, backed by President Donald Trump's administration in the case, argued that it was only acting as an agent for app developers, who set their own prices and pay Apple's commission.

Apple could of course be forced to open up its payment processing to competition and app developers would be able to choose which one to go with. Engadget has reached out to Apple for comment.

"At this early pleadings stage of the litigation, we do not assess the merits of the plaintiffs' antitrust claims against Apple, nor do we consider any other defenses Apple might have", he added.

"The problem is that the 30 percent commission falls initially on the developers", Gorsuch wrote.

Justice Brett Kavanaugh, joining the court's liberal wing in the majority, said App Store customers meet that test because they buy directly from Apple.

We're proud to have created the safest, most secure and trusted platform for customers and a great business opportunity for all developers around the world. This could be a very expensive decision against Apple; plaintiffs who win an antitrust suit can be awarded three times the amount of the damages that they are asking for.

Apple could sidestep the controversy, according to Lopatka, by allowing apps to be purchased through certified outside parties. The company says that in 2017, it paid developers over $26 billion.

Regardless, this means that, since it's no longer considered an intermediary, consumers can pursue the case against Apple.

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