LONDON – A case filed with the UK’s Competition Appeal Tribunal (CAT) is seeking damages of up to £1.5 billion (US$2.12 billion) from Apple, alleging that the 30 percent cut it takes on app sales is an abuse of its dominant market position and unlawful. However, Apple has described the claim as “meritless.”
Claimants Allege Apple Displaying ‘Behavior of a Monopolist’
The case is being taken to tribunal by Dr. Rachal Kent, a lecturer in digital economy at King’s College London. She told BBC News that Apple “charges entry and usage fees that are completely unjustified.” Dr. Kent added that Apple is displaying “the behavior of a monopolist.”
The UK does not have a class-action legal structure equivalent to that which exists in the U.S. However, CAT allows so-called “opt-out” claims. These cover all those affected unless users have decided to exclude themselves from the claim. This particular case alleges that Apple deliberately shuts out potential competition, requires customers to use its own payment-processing system, generating “unlawfully excessive levels of profit.” It also alleges that
these charges are “an unlawful raid on Apple’s customers’ purses.”
Apple Says Allegations ‘Meritless’
Apple hit back. In a statement given to The Mac Observer, a company spokesperson said:
We believe this lawsuit is meritless and welcome the opportunity to discuss with the court our unwavering commitment to consumers and the many benefits the App Store has delivered to the UK’s innovation economy. The commission charged by the App Store is very much in the mainstream of those charged by all other digital marketplaces. In fact, 84 percent of apps on the App Store are free and developers pay Apple nothing. And for the vast majority of developers who do pay Apple a commission because they are selling a digital good or service, they are eligible for a commission rate of 15 percent.