WASHINGTON: When iPhone users want to edit blemishes out of their selfies, identify stars and constellations or join the latest video game craze, they turn to Apple Inc’s App Store, where any software application they buy also includes a 30% cut for Apple.That commission is a key issue in an antitrust case that will reach the US Supreme Court on Monday. The nine justices will hear arguments in Apple’s bid to escape damages in a lawsuit accusing it of breaking federal antitrust laws by monopolising the market for iPhone apps and causing consumers to pay more than they should.
The justices will ultimately decide a broader question: Can consumers even sue for damages in an antitrust case like this one?
Apple, which is appealing a lower court decision that revived the proposed consumer class-action lawsuit, says no, citing a decades-old Supreme Court precedent. The company said that siding with the iPhone users who filed the lawsuit would threaten the burgeoning field of e-commerce, which generates billions of dollars annually in US retail sales.
The plaintiffs and antitrust watchdog groups said that if the justices close courthouse doors to those who buy consumer products, monopolistic conduct could expand unchecked. “A lot of technology platforms will start making the argument that consumers don’t have standing to bring antitrust suits against us,” said Sandeep Vaheesan, legal director for the Open Markets Institute, a Washington-based antitrust advocacy group.
“Uber could say, we’re just providing communication services to ride-sharing drivers,” Vaheesan said. “If there’s an antitrust issue, the drivers can bring a claim but passengers do not have standing.”
The iPhone users accused Apple of violating federal antitrust law by monopolising the sale of paid apps, leading to inflated prices compared to if apps were available from other sources.
Though developers set the prices of their apps, Apple collects the payments from iPhone users, keeping a 30% commission on each purchase. One area of dispute in the case is whether app developers recoup the cost of that commission by passing it on to consumers. Developers earned more than $26 billion in 2017, a 30 percent increase over 2016, according to Apple. The firm said it is acting only as the agent for app developers who sell the apps to consumers through the App Store.