Apple faces lawsuits over App Store prices

The US Supreme Court ruled that consumers can press ahead with a lawsuit that accuses Apple of using its market dominance to artificially inflate prices at its App Store.

The 5-4 ruling could add to pressure the company faces to cut the 30% commission it charges on app sales.

Lawyers pressing the case said they will seek hundreds of millions of dollars on behalf of overpaying consumers. 

Apple contended the lawsuit was barred under a 1977 Supreme Court ruling that said only direct purchasers of a product can collect damages for overpricing under federal antitrust law. 

That decision was designed in part to keep companies from having to pay twice for the same misconduct.

Justice Brett Kavanaugh, joining the court’s liberal wing in the majority, said App Store customers meet that test because they buy directly from Apple.

“The iPhone owners are not consumers at the bottom of a vertical distribution chain who are attempting to sue manufacturers at the top of the chain,” wrote Mr Kavanaugh. 

“There is no intermediary in the distribution chain between Apple and the consumer.”

Apple and its tech-industry allies had said before the ruling that a decision allowing the lawsuit could lead to expensive antitrust claims against other companies that run online marketplaces, potentially affecting Google, Amazon, and Facebook.

In dissent, Justice Neil Gorsuch said the ruling “exalts form over substance”. 

He was joined by Chief Justice John Roberts and Justices Samuel Alito and Clarence Thomas.

Apple told the high court it passed $26.5bn (€23.6bn) on to developers in 2017.

Bloomberg

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