The Supreme Court is allowing an antitrust litigation against Apple proceeds, and it declined Apple’s argument that iOS App Store users aren’t really their customers. The Supreme Court maintained the judgment of Ninth Circuit Court of Appeals’ in Apple v. Pepper case, conceding in a 5-4 decision that Apple app buyers could bring legal charges against the company for supposedly driving up prices. Justice Brett Kavanaugh mentioned that Apple’s drawing its line doesn’t make any sense, other than as a way to manipulate Apple out of this and similar legal actions.
Apple had asserted that iOS users were exclusively buying apps from developers, while developers themselves were the customers of Apple’s App Store. According to an earlier legal conviction known as Illinois Brick, “indirect purchasers” of a product don’t have the position to file antitrust cases. However, in 13th May’s decision, the Supreme Court determined that this logic doesn’t apply to Apple.
The court is careful to notice that it’s an “early stage” of the case, so there’s no ruling on whether Apple actually does have an illegal monopoly in the App Store. However, its decision could have larger complication for customers who want to bring legal action against any app seller for antitrust breaches, and it prepares the stage for a crucial battle between Apple and some angry customers.
Apple v. Pepper insist that by needing iOS users to purchase apps through the official App Store and charging developers a 30% commission, Apple is adding a de rigueur fee that developers logically pass on to customers.
As per the claim monopolistic retailer (here, Apple) has used its monopoly to overcharge consumers is a classic antitrust claim. However, Apple states that the iOS users for this case may not sue Apple because they allegedly were not ‘direct purchasers. If Apple does eventually lose this case, it could have to pay back anyone who was charged too much, due to its App Store markup. Apple made other legal assertion to fight this outcome. However, the Supreme Court particularly isn’t addressing these arguments still.