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US Supreme Court to weigh in on App Store antitrust case

Tim Maytom

The US Supreme Court is set to reach a decision later today on whether or not consumers and developers can sue Apple for monopolising the iOS app distribution market with its App Store. While the verdict by the US' highest court of law will not decide any specific antitrust case, it could open the door to a number of civil actions aimed at Apple.

The nine justices of the Supreme Court are set to hear arguments from Apple's lawyers, who claim that allowing Apple to be sued by consumers in this area could threaten the eCommerce industry and cause retail sales to slow. Apple is also pointing to a decades-old Supreme Court precedent in its appeal against a decision made by the 9th US Circuit Court of Appeals, which gave the go-ahead to a consumer class-action lawsuit last year.

The case largely centres on whether or not Apple's iOS App Store constitutes a monopoly in terms of distribution of iOS apps, and if so, does Apple's 30 per cent cut of app purchases and transactions count as it exploiting that monopoly for financial gain. If the Supreme Court upholds the existing decision, then Apple is potentially responsible for millions in over-spending by consumers, and those who have bought apps via the App Store or made in-app purchases through iOS apps could pursue class-action suits to reclaim that money.

The plaintiffs in the current case, as well as antitrust watchdog groups, have argued that if the Supreme Court goes against the current ruling and finds in Apple's favour, it will close the door to those purchasing digital products and could lead to more tech firms adopting monopolistic strategies.

"A lot of tech 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, an antitrust advocacy group. "Uber could say, we're just providing communication services to ride-sharing drivers. If there's an antitrust issue, the drivers can bring a claim but passengers do not have standing."

A 1977 Supreme Court ruling limits damages for anti-competitive conduct to those directly overcharged instead of indirect victims who paid an overcharge passed on by others. Apple's argument is that it only acts as the agent for app developers to sell to consumers through its App Store, and that upholding the 9th Circuit's ruling could be dangerous for the eCommerce industry, which increasingly relies on agent-based sales models. While the Trump administration has supported Apple's argument, the plaintiffs are backed up by the attorneys general of 30 states, including California, New York, Texas and Florida.