Justices Appear Skeptical in Apple Antitrust Case

us about it is Greg Store, Bloomberg, new Supreme Court reporter. So, Greg, consumers want to sue Apple, saying it's using its dominance in the market to jack up the prices for iPhone apps. What's the issue with that lawsuit, Julie. The issue is that the Supreme Court has said in previous cases that the only one who can sue under federal antrust law is the direct purchaser of something. And this lawsuit focuses, at least in part on the commissions that Apple charges

to the developers. Those are UM and UH. The consumers say those are higher than they should be if there were a true competition here, and so Apple's argument is that the consumers are not the direct purchasers of UH. These the distribution services that the commissions pay for. They say, the only one who can sue us for having allegedly too high commissions are the app developers, not the consumers.

And what does what does the consumer groups say? Well, the consumers say that we ultimately end up paying the cost of the commissions through higher app prices. And they also say that the case is not just about the commissions, It's about Apple's total control of the system for buying apps. They say, Look, if you're gonna, if you have an iPhone, you want to buy an app, the only place you can go is the app store, and Apple at the app Store has some control over the prices that that

developers can charge. They are charged in UH amounts ending in ninety nine or a dollar ninety nine or two UM and uh. The consumers say that that overall control is enough that that uh it feels like you are buying the app from app directly from Apple uh and therefore we should be allowed to sue Apple for inflated prices. So antitrust cases sometimes not always, but sometimes divide the Supreme Court along ideological lines. What can you glean from

the justices questions this morning? So this one sort of divided them along ideological lines. If the four liberal justices all seemed like they were varying kind to let this lawsuit go forward, uh, Justice Kavana, the newest judge, justice, might join them in that. And then you had two of the more conservative justices, Gorsu and Alito, and they

were asking a much bigger question. Uh. Justice Corsue in particular was suggesting that he doesn't like this direct purchase or requirement at all, and he would consider throwing out the ninety seven Supreme Court ruling that that imposed the direct purchaser requirement. If the court were to go that route, the consumers would be allowed to to move forward with their suits. So you could end up with kind of a combination of rationales for letting this lawsuit go forward.

So we're the justices up to date on the tech aspects of this, because sometimes in these arguments they're a little behind the curve. Yeah, there weren't any any of those moments where you're like, Wow, they really don't understand

what's going on here. One justice who tends to be one of the more tech savvy justices, Justice Kagan uh did talk about the process of buying an app on her iPhone as She talked about when I, you know, buy something, I'm paying you know, I go to the app store, I'm paying for it using my Apple I D and the credit card information stored there. So she seemed to be speaking from personal experience in doing that. UH. For the most part, the other questions didn't get too

deeply into the actual operation of smartphones. Tell us the effect of a broad ruling in this case versus a limited ruling, how many companies might it affect? So there are a lot of companies in this uh, this internet economy um uh, an awful lot of companies like eBay, like et Sea, like Amazon serve as kind of the middleman. They have a marketplace. UM. The consumers suing Apple say, you don't have to get into the way those companies work, because Apple is so different in the amount of control

it exercises over the app store. But it's at least possible that a decision letting this lawsuit go forward could make it easier for consumers trying to sue at least some of those other companies, especially the ones that do exercise a lot of control over the marketplaces they run. Let's turn to certain requests the Justice Department is once again trying to jump over the Circuit Court of Appeals and asking the court to review President's Trump's ban on

military service by transgender people. Tell us about that. Yeah, so this is a policy that the Trump administration has tried to put in place, but several federal district judges have blocked them from barring service by transgender people. And the Trump administration has said, we need to get this issue resolved very quickly, so they filed uh petitions here at the Supreme Court on Friday, uh saying, don't even

bother waiting for the appeals court to rule. We think you should take it up now so that you can rule this term and and tell us by by June of next year whether we can indeed bar transgender people from serving in the military. How likely is it that the Court would grant certain that case and and avoid the Circuit Court. Well, I mean, we're speculating here, but that's a highly, highly unusual thing for the Supreme Court

to do. It almost always wants the lower courts to fully vet an issue and certainly having the federal appeals courts rule on it for they take it up. On occasion, the Court will do that if there's a special urgency for something, or if maybe they're already considering related to in a separate case and they and they just want

to broaden what they're thinking about. UM. You know, it would be an extraordinary thing for the Supreme Court to do, especially given that so far the Court has suggested it wants to step carefully and move slowly when it comes to some of these centerpiece issues, uh, pushed by the Trump administration. Speaking of extraordinary things at the Supreme Court, I have to ask you about the Chief Justice pushing back on the President's criticisms of judges appointed by former

President Barack Obama. How out of character was that for the Chief It is extremely out of character. He has talked about, uh, the importance of an independent judiciary. He has said that repeatedly. He has said that he doesn't view judges as being partisan actors. They're not Republican judges

or democratic judges. He said that all before. But this came in response to a question from an Associated Press reporter asking whether the Chief Justice want to respond to the President's criticism of the Federal District Judge and the Federal Appeals Court. And so the Chief Justice put out a statement, and that is something that he has never done. It is uh, it is John Roberts standing up to

Donald Trump in a way that he hasn't before. And it is certainly a fascinating dynamic that we're going to be watching while the Supreme Court considers all these hot button Trump administration appeals. Only that a minute here, Greg, what do you think it was that led him to make that statement? You know it again, we're getting a

little bit in the speculation. But the President uses the phrase Obama judge to describe this, this federal district judge who who ruled against the administration on an asylum issue. That is a characterization that John Roberts really resists. Um uh. He certainly understands that that. You know, judges come to the court with different views. But this is a guy who, in his confirmation hearing said judges should be like umpires.

He does not believe they should be affiliated with the president who appointed them in the way the President suggested. All right, thanks so much, Greg for your insights. That's Greg stores Bloomberg, new Supreme Court reporter. Thanks for listening to the Bloomberg Law podcast. You can subscribe and listen to the show on Apple podcast, SoundCloud, and on bloomberg dot com slash podcast. I'm June Brasso, this is Bloomberg. Yeah,