Supreme Court appears skeptical of Apple’s arguments in App Store monopoly case

Liberal justices Elena Kagan, Sonia Sotomayor and Stephen Breyer took issue with that formula. In an exchange with Daniel Wall, who represented the company before the court, Kagan outlined her thinking of the case in personal terms.

“I mean, I pick up my iPhone. I go to Apple’s App Store. I pay Apple directly with the credit card information that I’ve supplied to Apple,” Kagan, the youngest member of the court’s liberal wing, said. “From my perspective, I’ve just engaged in a one-step transaction with Apple.”

Alito, a George W. Bush appointee, suggested Illinois Brick may no longer be relevant. He told Wall that “I really wonder whether, in light of what has happened since then, the court’s evaluation stands up.”

“Take the third point that it makes about the direct, so-called direct purchasers are the most efficient and most — in the best position to — to sue,” Alito said. “If we look at this case, how many app developers are there whose apps are sold at the Apple store?”

Wall responded that there are tens of thousands of app developers. Alito asked if any had ever brought a lawsuit against Apple.

“None have ever sued,” Wall said.

Gorsuch, Trump’s first Supreme Court nominee, noted that “direct purchasers don’t always sue because there’s a threat that monopolists will share” the profits with them.

“Shouldn’t we question Illinois Brick, perhaps, given the fact that so many states have done so?” Gorsuch asked.

A coalition of thirty-one states, including Texas and California, filed a brief with the court asking it to overturn the Illinois Brick ruling. The states did not take a position on the antitrust allegations against Apple.

Justice Brett Kavanaugh, who was confirmed in October, was more reserved in his questioning than Gorsuch or Alito. He noted, however, that “the consumers are harmed” in addition to the app makers. And he told Solicitor General Noel Francisco, who argued in support of Apple, that “we have ambiguity about what Illinois Brick means here.”

“Shouldn’t that ambiguity, if — if there is such ambiguity, be resolved by looking at the text of the statute? Any person injured?” he said.

Roberts suggested with his questions that he agreed with Apple’s position. The other conservative on the bench, Justice Clarence Thomas, remained silent, which he typically does when hearing cases.

An adverse ruling for Apple in the case could have a broad impact, affecting other tech giants, like Facebook, Ebay, Amazon and Alphabet’s Google, which operate similar electronic marketplaces. The court is expected to issue a ruling by late June.

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