Supreme Court rules Apple will face antitrust suit for its iPhone apps

Apple is seen at a store in Zurich Switzerland

Apple is seen at a store in Zurich Switzerland

The Supreme Court ruled against Apple on Monday in an antitrust lawsuit that accused the tech company of monopolizing IOS apps and artificially inflating prices through its App Store.

"Apple posits that allowing only the upstream app developers - and not the downstream consumers - to sue Apple would mean more effective antitrust enforcement", the Supreme Court said in the decision. The company claims a 30 percent cut from most transactions, shrinking to 15 percent only for subscriptions active for over a year. Instead, Apple is simply a third party that sits between the users and the app makers. The group of plaintiffs argued that developers priced their apps higher than they otherwise would to account for Apple's commission. The opinion, authored by Justice Brett Kavanaugh, declined to take a specific stance regarding Apple's business practices.

It isn't just paid apps or in-app purchases that make pricing decisions to account for Apple's decision. In that case, the court limited damages for anti-competitive conduct to those directly overcharged rather than indirect victims who paid an overcharge passed on by others.

Apple had argued it's merely a pipeline between app developers and consumers, and that iPhone users have no claims against Apple under antitrust law.

The Supreme Court justices ruled 5-4 that a class-action lawsuit filed by consumers can proceed, the Washington Post reported. It has moreover claimed that by paying its commission, developers are "buying a package of services which include distribution and software and intellectual property and testing". Pro-Apple Justices included Samuel Alito and Neil Gorsuch, both of whom hinted that Illinois Brick should be re-examined. Gorsuch also was appointed by Trump.

We have reached out to Apple for comment and will update this story with any response. They were supported by 30 state attorneys general, including from Texas, California and NY. The case, Apple v. Pepper, was actually dismissed in 2013 by a California court, but the Court of Appeals for the Ninth Circuit allowed it to return in 2017.

In a bipartisan 5-4 decision, the highest court in the US ruled that consumers can sue Apple for anti-competitive practices regarding the App Store on Monday.

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