WASHINGTON — The U.S. Supreme Court heard a potentially significant antitrust case Monday to decide whether Apple can be sued for using its monopoly power over its iPhones to profit from the sale of apps.
Lawyers for the Trump administration joined with Apple in urging the high court to throw out the case, but they ran into skeptical questions from most of the justices.
“This is a closed loop,” Justice Sonia Sotomayor told a lawyer for Apple.
Users of the iPhone have to buy apps through Apple, she said, and that at least looks like a monopoly arrangement.
“Consumers are harmed, too,” added Justice Brett Kavanaugh, as they allegedly pay higher prices because Apple takes a 30 percent commission on the sale of apps.
The outcome in Apple v. Pepper is being closely watched — not only by developers who make apps for Apple but by online vendors who sell products on other platforms such as Amazon.
The justices will not decide whether Apple must pay damages for using its monopoly power.
At issue now is only whether the antitrust suit against Apple can proceed to further hearings and a trial on whether Apple wields monopoly power.
But much of corporate America has joined in support of Apple and argued that such broad antitrust claims should be blocked at the starting gate.
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Apple’s lawyers rely on a long-standing court doctrine that holds only “direct purchasers” may bring an antitrust claim. They describe the iPhone as akin to a shopping mall where consumers can freely shop for apps and buy what they choose.
Under this “shopping mall” theory, a shopper cannot sue the owner of the mall by asserting he or she paid too much for a product at a store.