Consumers can sue Apple over allegedly monopolizing the market for iOS apps, which they say raises prices, the Supreme Court ruled Monday. In addition, Apple takes a 30 percent cut of every sale, which the lawsuit alleged was passed down to consumers in the form of overpriced apps. That's even though Apple - which the Trump administration sided with - tried to claim it doesn't actually sell apps directly to consumers. Court precedent says that indirect purchasers who are at least two steps removed in a distribution chain can not sue.
The Ninth Circuit, however, said that Apple is indeed the seller, through their App Store. Based on its own interpretation of the legal precedent, Apple argues that consumers can only sue the developers due to their role setting prices. The court's four liberal justices joined Kavanaugh in the 5-4 decision.
"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. For subscriptions, Apple collects a 15 percent share after the first year.
A month ahead of Apple's Worldwide Developer Conference (WWDC 2019), a report has come out claiming that Apple won't upgrade a substantial number of iOS devices that received iOS 12, to expected iOS 13. That's not an easy calculation to do-and it's not a problem that comes up if developers sue Apple instead.
"It is undisputed that the iPhone owners bought the apps directly from Apple", Kavanaugh wrote, splitting with a district court that previously held the app developers responsible for pricing.
Apple has been in and out of court since 2011 to argue whether it forces them to overpay for apps by effectively killing off competitors on the multibillion-dollar App Store. Justice Neil Gorsuch led the conservatives in dissent.
The class-action lawsuit seeks refunds on behalf of millions of users who have paid inflated prices for apps as a result of Apple's exclusionary practices. That may be coming to a head not just through Apple v. Pepper, but a European Commission investigation sparked by Spotify.