Judge Approves Apple's $100M Settlement in Developer Lawsuit, But Questions $27M Attorney Fee
Back in August 2021, Apple agreed to pay $100 million and make changes to the App Store to settle a class-action lawsuit brought against it by developers. Judge Yvonne-Gonzalez Rogers, who is overseeing the case, said yesterday that she plans to approve the settlement, but she raised concerns about the amount that attorneys are planning to charge.
As outlined by Law360, Rogers said that she wants more data on the "math" behind the $27 million attorney fee requested, and how much that fee will reduce claims by small developers. She asked for a mathematical breakdown of how much less each class member would receive if she awarded $25 million in attorney fees instead of $27 million.
Rogers said that for some developers, the difference could be significant, which is why she wants to "see the numbers." Apple back in March pointed out that the $27 million fee is higher than the 25 percent benchmark set by the Ninth Circuit Court.
Apple is calling the settlement the Small Developer Assistance Fund, and it began accepting developer claims in January. Developers had until May 20 to submit a claim through the website, and Apple provided several reminders. Developers were able to claim between $250 and $30,000 based on their historic App Store participation.
There were approximately 67,000 eligible developers. Developers who earned less than $100 will receive the minimum payment of $250, while those who earned more than $1 million will be entitled to a higher-end payment. Minimum payments are subject to change based on the number of total claims.
The settlement stems from a 2019 lawsuit where group of iOS developers accused Apple of using its App Store monopoly to impose "profit-killing" commissions. The developers were unhappy with Apple's 30 percent cut of App Store sales, an issue that was addressed with the App Store Small Business Program that dropped the commission that small developers have to pay to 15 percent.
In addition to paying a $100 settlement fee, Apple agreed to allow developers to use communications like email to share information about payment methods available outside of the App Store, plus Apple expanded the number of price points available to developers for subscriptions.
Apple also pledged to maintain the App Store Small Business Program and App Store search, making no changes for at least three years, with the company also creating an annual transparency report based on App Store data covering app rejections, apps removed from the App Store, search information, and more.
The Small Developer Assistance Fund website says that it plans to distribute funds to developers who submitted a "timely and valid claim" as soon as possible.