Court Rules Apple Can Be Sued for Monopolizing iPhone App Market

appstoreA U.S. Appeals Court today ruled that App Store customers can move forward with a lawsuit claiming Apple created an illegal app monopoly because it did not allow users to purchase iPhone apps outside of the App Store, reports Reuters.

The decision reverses a 2013 ruling that dismissed the lawsuit, originally filed in 2012. The case, Pepper et al v. Apple Inc., alleges that by not letting users purchase apps from third-party sources, there was no price competition, leading to higher app prices.

When the lawsuit was originally filed, Apple requested that it be dismissed because developers, not Apple, set prices for App Store apps. Apple simply provides the platform developers use to sell apps to customers.

According to today's ruling, because iPhone users purchase the apps directly from Apple, they have the right to file a lawsuit against the company.

An attorney for the plaintiffs in the case told Reuters that the aim of the lawsuit is to allow people to shop for iPhone apps wherever they want, an outcome that's unlikely due to security implications.

But if the challenge ultimately succeeds, "the obvious solution is to compel Apple to let people shop for applications wherever they want, which would open the market and help lower prices," Mark C. Rifkin, an attorney with Wolf Haldenstein Adler Freeman & Herz representing the group of iPhone users, told Reuters in an interview. "The other alternative is for Apple to pay people damages for the higher than competitive prices they've had to pay historically because Apple has utilized its monopoly."

The Appeals Court ruling does not address the specific monopoly allegations levied at Apple and pertains only to whether or not Apple can be sued for this issue.

Top Rated Comments

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42 months ago
Abuah?!

what?

listen, i'm all against monopolistic competitive practices.
I'm all for releasing some stranglehold on economies that filthy rich have. i'm all for competition for luxury items.

but There's no monopoly here. If you don't like Apple's app store policy, There's a giant swath of Android manufacturers out there offering competitions, many come with their own App stores. If you're looking for an open and free market, that exists.

But where then does this "monopoly" end? What about OS? Apple has 100% of iOS installations on iPhones. is that not a monopoly preventing me choice of what OS I want? (although, I would love to buy an iPhone running android :p)


this is a slippery slope. Sometimes, yes, Lawsuits are required to keep a company in check, but sometimes, these things are more dangerous to the market than helpful
Score: 109 Votes (Like | Disagree)
Avatar
42 months ago
In other news McDonald's is being sued for being the only place you can buy a Big Mac
Score: 90 Votes (Like | Disagree)
Avatar
42 months ago
They created the iPhone, they created the App Store, they created the developer system. App developers agree to the terms and condition. The apps are approved for use with the iOS.

They own the entire ecosystem.

How in the hell so you sue somebody for something they developed and own 100%?

This will be an ongoing case which will cost millions and the outcome will be in favour of Apple, because of the above.
Score: 54 Votes (Like | Disagree)
Avatar
42 months ago
Fantastic, just what the App Store needs - lower prices :rolleyes:

What an idiotic law suit. Developers receive 70%-85% of the revenue passing through the store and they control the pricing so how on earth can this be deemed a monopoly...
Score: 38 Votes (Like | Disagree)
Avatar
42 months ago
This is stupid straight up. I hope next they can rule that I can set up a shop inside of Walmart or maybe I want to sell some sculptures inside Tiffany's.

What a mess.
Score: 36 Votes (Like | Disagree)
Avatar
42 months ago
I thought the purpose of selling within the App Store was to protect iOS users from malicious software.

At least that was the official reason...
Score: 27 Votes (Like | Disagree)

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