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Apple in Supreme Court battle over App Store

Nov 26, 2018 POSTED IN BusinessTech BY blogger
Nov 2018



Apple will head to the US Supreme Court this week to block a group of customers from suing the tech giant for monopoly abuse, media has reported.
The company is battling a group of iPhone owners who claim Apple forces them to overpay for apps by forbidding rivals to the multibillion-dollar App Store.
After the customers won the right to launch a class action lawsuit against the company in 2017, Apple is now appealing to the Supreme Court to have the decision overturned, The Telegraph reported late on Saturday.
If Apple fails, the business model of the App Store, one of the company’s fastest-growing and most profitable divisions, could be threatened, it added.

The issue for the Supreme Court is whether Apple can even be sued about the apps, given prior high court rulings in antitrust cases. In other cases, the justices have said there must be a direct relationship between the seller and a party complaining about unfair, anti-competitive pricing.
Consumers can choose from among more than 2 million apps, up from the 500 apps that were available when Apple created the App Store in 2008. “The phrase ‘there’s an app for that’ is now part of the popular lexicon,” Chief Justice John Roberts noted in a 2014 decision limiting warrantless searches of cellphones by police. Apple has trademarked the phrase.
But the company says the popularity of software for iPhones and its App Store shouldn’t obscure that consumers buys apps from developers, not Apple.

If Apple wins, it does so by convincing the court that it can’t be the subject of this particular type of damages, only the app developers can. In theory, then, the app developers could be open to being sued. In practice, it’s unlikely that anyone will attempt to sue hundreds or thousands of individual app companies, but those developers could sue Apple if they believe they’ve been overcharged.
A ruling against Apple will likely see unspecified damages levied if Apple loses the resultant case, but more significantly the likelihood of other cases being brought against online and technology companies in similar positions. Plus, it would change the nature of application distribution should Apple, Google, Facebook, and others decide to not be faced with this kind of liability. This will set off probably a decade or more of suits, counter-suits, and appeals.
Either way, the ruling at some point in 2019 isn’t the end of the story.