Supreme Court allows antitrust lawsuit to move forward

May 14, 2019 06:15 GMT  ·  By

The United States Supreme Court has decided to allow an antitrust case against Apple to move forward after the company previously appealed a lower court ruling against it.

As explained in the official Supreme Court’s decision here, Apple is being accused of forcing the App Store on its customers, eventually using its monopolistic power to charge both developers and consumers.

Technically, Apple only allows iPhone apps to be distributed through the App Store. Developers can create apps and publish them in the App Store with a $99 account. If these apps are being sold through the App Store (hence they aren’t offered free of charge), Apple gets a 30% percent of the revenue.

Apple’s approach could pave the way for an antitrust lawsuit, as forcing the App Store on customers and developers and then taking a cut of all sales could mean the company’s business model is based on a monopolistic system.

Consumers could sue Apple over antitrust violation

The Supreme Court explains in the Opinion of the Court (linked above) that it’s looking into the rights of consumers to sue Apple for this approach.

“A claim that a monopolistic retailer (here, Apple) has used its monopoly to overcharge consumers is a classic antitrust claim. But Apple asserts that the consumer plaintiffs in this case may not sue Apple because they supposedly were not “direct purchasers” from Apple under our decision in Illinois Brick Co. v. Illinois, 431 U. S. 720, 745–746 (1977),” the court says.

“We disagree. The plaintiffs purchased apps directly from Apple and therefore are direct purchasers under Illinois Brick. 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. We merely hold that the Illinois Brick direct-purchaser rule does not bar these plaintiffs from suing Apple under the antitrust laws.”

Needless to say, this isn’t a ruling against Apple, but while we’re probably several years away from a decision in this case, it could eventually be the first step towards bigger changes in the App Store, including lower cuts on the App Store dev revenue.