Phi Finney McDonald acts for the Lead Applicant in a class action commenced in the Federal Court of Australia against Apple Inc and Apple Pty Limited (together, Apple) on behalf of eligible Australian iPhone and iPad users who purchased iOS apps and in-app digital content from iOS apps from 6 November 2017 to 20 June 2022 (Apple Class Action).

The Apple Class Action is funded by Vannin Capital and is the subject of a registered managed investment scheme named the Apple Litigation Funding Scheme (ARSN 655 066 924) operated by CASL Governance Ltd (Scheme).

Background 

Apple Inc developed and operates the Australian Apple App Store and the payment solution for both app and in-app purchases by Australian iPhone and iPad users. Apple Pty Limited, among other things, collects and receives payments from purchasers of iOS apps or in-app digital content from iOS apps. Apple typically charges developers a 30% commission on these purchases, or in some limited cases, 15%. 

Allegations 

  1. Apple had a substantial degree of power in the markets for the purchase of apps from the Australian Apple App Store (the iOS App Distribution Market) and for the purchase of digital content from within such apps (the iOS In-App Payment Solution Market).
  1. Apple was able to impose terms on iOS app developers which restricted the ability of these developers to offer other means of iOS app distribution and payment for such apps and in-app digital content purchases from those apps.
  1. As well, Apple was able to charge commission rates on those purchases over and above what it would otherwise have been able to charge in a competitive market.
  1. By the above conduct, Apple Inc and/or Apple Pty Limited, among other things:
    • gave effect to provisions in a contract which restrained developers from distributing iOS apps other than through the Apple App Store and from using payment solutions other than those controlled by Apple;
    • supplied services to iOS app developers on the condition that those developers not use alternative means of distributing iOS apps and payment solutions other than those controlled by Apple;
  1. The above conduct had the purpose, effect or likely effect of substantially lessening competition in the markets for distribution of
    • the iOS App Distribution Market; and/or
    • the iOS In-App Payment Solution Market,

in contravention of ss. 45, 46 and 47 of the Competition and Consumer Act 2010 (Cth); and

  1. This conduct resulted in higher prices for users who purchased apps and in-app digital content from those apps through the Australian Apple App Store.
  1. The above conduct also was, in all the circumstances, unconscionable in contravention of s. 21 of the Australian Consumer Law.

The proceeding seeks compensation for eligible users from Apple for the excess price charged to those users.