Supreme Court Might Allow iPhone Users To Sue Apple For Monopolizing Its App Store

When presiding over the long-running antitrust case against Apple, the U.S. Supreme Court appeared to be leaning towards iPhone users, who claim that the company is responsible for inflating App Store prices. Currently, the court is not trying to settle the antitrust issue itself; it is deliberating whether Apple can be sued by the iPhone owners at all.

Apple V. Pepper

The Apple Inc. v. Robert Pepper case was filled back in 2011 and it claims that since iPhone owners can only download apps from the company’s App Store, it is essentially a monopoly, as a result of which consumers are forced to pay more for apps than they ideally should. This is further exacerbated by the fact that Apple’s pockets a handsome 30 percent of the developer’s revenue, which is passed on to consumers in the form of a price hike. In order to break free from the locked-down ecosystem, the buyers are requesting the legal system to order Apple to permit third-party iOS apps. However, Apple argues that developers are the ones who set the prices of the apps, and it is merely an intermediary.

Can The Illinois Brick Doctrine Save The Day?

Back in 1977, the “Illinois Brick doctrine” was established, under which only the direct buyer of goods and services can collect antitrust damages. Apple says that under this doctrine, only app developers can have a beef with the company. However, the lawyers representing the customers argue that when a buyer engages in a transaction, they deal directly with Apple. According to reports, Supreme Court seems to be skeptical of Apple and might let the case proceed against the iPhone maker in the lower court.

The case couldn’t have come at a worse time for Apple. According to reports, it has cut the iPhone XS (review) and iPhone XR (review) orders a second time around because of lower than expected sales. Per analysts, the company is counting on its services business to keep revenues high during a time when smartphone sales have flattened out. The lawsuit can disrupt the company’s software sales ecosystem and ultimately, the court might even cede to the plaintiff’s demand for monetary compensation. The case could have far-reaching effects, and may shape how people interact with digital platforms in the future.

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