Billion-Pound Lawsuit Against Apple Over App Store Monopoly Opens in UK

(FILES) This illustration photo shows the Apple app store logo reflected from an iPhone onto the back of an iMac in Los Angeles, August 26, 2021. Did US tech giant Apple abuse the dominant position of its app store in the UK? A trial opening Monday, January 13, in which plaintiffs want more than one billion pounds is set to answer that question. (Photo by Chris DELMAS / AFP)

A landmark trial began in London on Monday to determine whether Apple abused its dominant position with the App Store in the UK.

The lawsuit, seeking over £1 billion in damages, alleges that the tech giant violated European and UK competition laws by excluding rival app stores from its iOS devices, such as iPhones and iPads.

The Complaint

The case, filed in May 2021, claims that Apple’s restrictions on rival app stores led to approximately 20 million UK users being overcharged. The plaintiffs argue that a 30% commission Apple imposes on apps and in-app purchases has unfairly inflated costs for consumers.

Rachael Kent, a King’s College London lecturer specializing in the digital economy, and the law firm Hausfeld & Co., are leading the case. Kent told AFP, “The 30% surcharge relates to most applications downloaded and used for in-app purchases on the App Store,” citing Tinder as one example.

However, the commission does not apply to apps offering physical goods or services, such as Deliveroo or Uber Eats.

Scope and Potential Damages

The claim seeks total estimated damages of £1.5 billion ($1.8 billion). Any consumer who purchased apps or subscriptions from the UK App Store between October 1, 2015, and November 15, 2024, may be eligible for compensation, unless they opt out of the class action.

Apple’s Response

Apple has dismissed the lawsuit as “meritless.” The company pointed to a 2022 statement emphasizing that 85% of the apps on the App Store are free. It also defended the commission charged, stating that it is “in line with those charged by other digital marketplaces.”

Apple insists that the App Store has delivered substantial benefits to the UK’s innovation economy and maintains its commitment to consumers.

Global Scrutiny

The case is part of a broader trend of global scrutiny and legal challenges faced by Apple concerning its App Store policies. In another UK case, developers are pursuing £785 million in damages over App Store charges.

Additionally, the European Commission has accused Apple of breaching digital competition rules by preventing developers from directing users to alternative payment platforms. Under pressure, Apple announced in August that iPhone and iPad users in the EU could remove the App Store and use competing platforms.

Rachael Kent underscored the importance of such legal actions, saying, “They’re responding to these investigations and being told what to do. I don’t think they’re going to do it voluntarily, which is why it’s crucial to bring these collective actions.”

The trial, which is expected to last seven weeks, could have significant implications for Apple’s practices and consumer rights in the UK and beyond.