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The first trial stemming from a wave of antitrust class action lawsuits in the UK against big tech companies is set to begin on Monday as Apple faces a £1.5bn legal claim because it charges “excessive and unfair” fees for software downloaded from its Store. Its applications.
Barring a last-minute settlement, the iPhone maker will begin a courtroom showdown at the UK's Competition Appeal Tribunal over allegations that it abused its dominant market position to charge commissions of up to 30 percent on purchases in its App Store marketplace.
The seven-week trial, in which Apple's newly appointed CFO Kevan Parekh The court is scheduled to give testimony, the latest in a growing list of legal challenges facing major technology companies around the world.
In the United States, the Department of Justice did this Brought a case Against Apple, arguing that its App Store rules have stifled competition. However, Apple largely emerged Unharmed From a legal battle over the App Store with fortnite The creator of Epic Games started in 2020 and ended early last year.
Antitrust lawyers and the litigation finance industry that supports such cases will examine the CAT's actions as they try to gauge the odds of success for several other antitrust lawsuits against technology groups including Alphabet, Microsoft and Meta.
The case against Apple, on behalf of millions of UK consumers, comes after major setbacks last month due to two other class action claims.
Telecom operator BT They fought This is the case that overcharged landline customers, while MasterCard settle A dispute over card fees amounted to £200 million – a small fraction of the £14 billion that claimants were originally demanding.
A A series of claims Many of them have been brought against technology companies, under UK legislation drawn up a decade ago that allows for collective legal action over alleged breaches of competition law.
However, the cases have been bogged down by lengthy procedural arguments, and the case against Apple is the first in the sector to go to trial.
The claimants, led by “class representative” Rachel Kent, a lecturer at King's College London, say Apple created a monopoly by forcing developers who make software for devices such as the iPhone and iPad to distribute their apps using the company's App Store.
They are demanding £1.5bn from Apple, arguing that “excessive and unfair” commissions charged to developers are passed on to consumers who download software and purchase content or digital services within apps.
The claimants' lawyers, led by Mark Hoskins KC and Tim Ward KC, are expected to say that Apple made “exorbitant” profits, with the commissions being much larger than they would have been if the software had also been made available to third-party competitors. To the App Store.
While Apple's iOS operating system faces competition from Google and its Android mobile operating system, claimants assert that it has succeeded in entrenching market power within its “ecosystem” of hardware and software.
Apple said the lawsuit was “baseless.” “The commission charged by the App Store is very much in the mainstream of those charged by all other digital marketplaces,” she said when the case was first launched in 2022.
Apple added that most apps are offered for free, requiring no fees, and that the “vast majority” of developers are eligible for a reduced 15 percent commission, under rules introduced in 2020 for small businesses whose apps generate less than $1 million annually. .
Apple is expected to argue that the claimants have defined the market too narrowly to include only iOS apps and that it is not dominant in the broader markets for digital transactions and devices.
As it did when it faced similar complaints about its App Store policies from Epic Games and music app Spotify, Apple will likely say its commission is justified by the broader investments it makes in its platform, including not just payment processing but developer tools and security. Reviews, marketing and organization.
