Robert Pepper and three other iPhone users filed an antitrust complaint in 2011 claiming Apple created an unfair monopoly over the "iPhone apps aftermarket" and drove up phone prices by blocking third-party apps.
After a federal judge in Oakland, California threw out the suit, the San Francisco-based 9th U.S. Circuit Court of Appeals revived it in 2017, finding that Apple was a distributor that sold iPhone apps directly to consumers. From their perspective people on the App Store are "engaged in a one-step transaction with Apple", said Kagan.
Apple had argued it's merely a pipeline between app developers and consumers, and that iPhone users have no claims against Apple under antitrust law.
"So if the commission is in fact a monopolistic overcharge, the developers are the parties who are directly injured by it. Plaintiffs can be injured only if the developers are able and choose to pass on the overcharge to them in the form of higher app prices that the developers alone control".
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Apple posits that allowing only the upstream app developers - and not the downstream consumers - to sue Apple would mean more effective antitrust enforcement.
Explaining the ruling from the bench, Kavanaugh said the 1977 precedent was "not a get-out-of-court-free card for monopolistic retailers", an apparent allusion to the popular board game Monopoly. President Trump's second nominee to the high court faced fierce Democratic opposition during his confirmation process, over sexual misconduct allegations as well as his judicial philosophy.
Justice Neil Gorsuch, Trump's other pick, wrote the dissent for four conservative justices in the Apple case. This will allow the suits to go forward, and they could result in hundreds of millions of dollars in damages.
They claim that this puts Apple in breach of anti-trust laws. Apple said the consumers were indirect purchasers, at best, because any overcharge would be passed on to them by developers.