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Apple bids to throw out $1 billion UK lawsuit over app store fees

FILE PHOTO: The Apple logo is seen hanging at the entrance to the Apple store on 5th Avenue in Manhattan, New York, U.S., October 16, 2019. REUTERS/Mike Segar/

By Sam Tobin

LONDON (Reuters) - Apple on Tuesday asked a London tribunal to throw out a mass lawsuit valued at around $1 billion brought on behalf of more than 1,500 app developers over its App Store fees.

The case, worth up to 785 million pounds ($998 million) and one of several faced by the tech giant in the United Kingdom, alleges Apple charged third-party developers unfair commissions of up to 30% on purchases of apps or other content.

Sean Ennis, a competition law professor and a former economist at the OECD, is spearheading the case which was filed at the Competition Appeal Tribunal (CAT) last year.

His lawyers say Apple has abused its dominant position in the market for the distribution of apps on its devices and are seeking damages for UK-based developers.

Apple, however, says 85% of developers on its App Store do not pay any commission at all and is asking the CAT to throw out the case which its lawyers argue is "unsustainable".

Its lawyer Daniel Piccinin said developers cannot have a claim in the UK unless they were charged on purchases made through the UK App Store. That would only apply to a very small minority of the claimants, the company says.

But Ennis' lawyer Paul Stanley said in court filings that Apple "has come to the UK to offer services to UK businesses on a UK market and has abused its position by overcharging them".

This means UK law applies to the entire case and it can continue, he argued.

Apple is already facing a mass lawsuit over App Store commissions, which is being brought on behalf of around 20 million UK users and was given the go-ahead in 2022.

The company is also facing a separate case over allegedly defective iPhone batteries on behalf of around 24 million iPhone users, which was certified last year.

Apple is fighting both cases, which are not expected to come to trial before 2025.

($1 = 0.7865 pounds)

(Reporting by Sam Tobin; Editing by Mark Potter)