Taking advantage of a recent U.S. Supreme Court decision, a new class action lawsuit accuses Apple of artificially inflating App Store prices through a claimed monopoly on iOS app distribution.
The case was launched this week via the U.S. District Court for the Northern of District of California. Lawyers for the plaintiff, Edward Lawrence, say Apple is violating Section 2 of the Sherman Act, as well as Sections 4 and 24 of the Clayton Act, engaging in “a litany of anticompetitive conduct and practices designed specifically to unlawfully monopolize, fix, raise, maintain or stabilize prices.”
iOS was “intentionally designed to lock iPhone owners into buying applications only from Apple,” the complaint notes, and since Apple typically charges developers 30% for each App Store transaction, anyone downloading an app is effectively paying that extra amount. The 30% take is “mostly profit,” and would be “substantially less in an otherwise competitive market,” the suit alleges.
Lawyers further suggest that Apple’s tight control over iOS denies users “the ability to choose from potentially cheaper, more efficient and technologically superior new products.”
In compensation, the suit asks for damages with interest, attorney fees and an injunction against further monopolistic practices. If it makes class status, and subsequently wins in court, the suit is unlikely to pay out big dividends to individual App Store users, given the number of people on the platform.
The Supreme Court recently gave the go-ahead for a similar lawsuit, Apple v. Pepper, to head back to a lower court.
In that case, Apple has repeatedly argued that developers are ultimately responsible for setting prices, and that it’s not breaking any antitrust laws. It also suggests that developers are “buying a package of services which include distribution and software and intellectual property and testing.”
In its defense Apple has relied on the Illinois Brick doctrine, relating to direct versus indirect purchasers. That didn’t fly with Justices like Elena Kagan and Brett Kavanaugh.
This article was originally posted here