Legal

Supremes Greenlight Consumer Apple App Store Lawsuit

Supreme Court: Apple Lawsuit Can Move Forward

Apple was dealt a blow on Monday (May 13) after the Supreme Court ruled that an antitrust lawsuit over its App Store practices can move forward.

According to a report in The Wall Street Journal, the Supreme Court in a 5-4 opinion rejected Apple's argument that consumers can't sue the company because prices of apps in the App Store are set by developers, not by Apple. Plaintiffs, who are suing on behalf of app purchasers, contended that consumers have to pay increased app prices due to Apple's rule that all software for its mobile devices must be purchased through the App Store. The suit argues that if developers were able to sell the apps directly to consumers without the middleman, consumers would pay less.

If the plaintiffs win the case, it would be a big blow for Apple, given that the company usually gets 30 percent of each app that is sold and 15 percent of subscription fees sold through the App Store. The lawsuit also took issue with some of Apple’s rules, including one that requires developers to set price increases in 99-cent increments, noted the report.

The Supreme Court ruling focused only on whether or not consumers can sue Apple, and did not look at the merits of consumers’ claims. “If accepted, Apple’s theory would provide a roadmap for monopolistic retailers to structure transactions with manufacturers or suppliers so as to evade antitrust claims by consumers and thereby thwart effective antitrust enforcement,” Justice Kavanaugh wrote in a 14-page opinion. Kavanaugh was joined by Ruth Bader Ginsburg, Stephen Breyer, Sonia Sotomayor and Elena Kagan.

If the consumers were to win, Apple could be forced to change how apps are sold. It could also put Apple on the hook for "significant monetary damages," stated the report, noting the case could take one to two years to works its way through the court.

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