Apple Inc. AAPL and Amazon.com, Inc. AMZN face a consumer antitrust lawsuit that alleges their collusion in artificially inflating the prices of iPhones and iPads sold on the e-commerce site.
What Happened: A federal judge in Seattle has made a significant ruling, stating that Apple and Amazon must face a consumer antitrust lawsuit in the U.S. The lawsuit alleges that the two tech giants conspired to artificially inflate the prices of iPhones and iPads sold on Amazon’s platform, reported Reuters.
The ruling by U.S. District Judge John Coughenour came after both Apple and Amazon attempted to have the case dismissed on various legal grounds. The judge emphasized that determining the “validity” of the relevant market — a crucial aspect in antitrust litigation — would be left to a jury.
What Are The Arguments: According to the lawsuit, there were approximately 600 third-party Apple resellers on Amazon in 2018. The plaintiffs are U.S. residents who purchased new iPhones and iPads on Amazon from January 2019 onwards.
They claim that an agreement between Apple and Amazon limited the number of competitive resellers, thereby violating antitrust provisions. It is alleged that Apple offered Amazon a discount on its products in exchange for reducing the number of Apple resellers on the platform.
Apple’s defense argues that the agreement aimed to prevent the sale of counterfeit Apple goods on Amazon.
What The Ruling Means: The judge’s ruling means that the case will proceed to evidence-gathering and other pretrial proceedings. The court will address the motivations behind the Apple-Amazon agreement at a later stage of the litigation, the report noted.
Why It’s Important: The lawsuit in question was filed in November as part of a series of private and government-led legal actions that challenge Amazon’s online pricing practices. The complaint seeks unspecified triple damages and other forms of relief.
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