March 28, 2024

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Apple has been sued for possessing Tap-to-pay for iPhone

Apple has been sued for possessing Tap-to-pay for iPhone

A proposed class-action lawsuit targets Apple Pay, alleging Apple’s monopoly on contactless payments on the iPhone, allowing it to force card issuers to pay fees (Across Bloomberg). The lawsuit was initiated by the Iowa-based Affinity Credit Union, which issues Apple Pay-compatible debit and credit cards, but the company’s attorneys hope to make it a class action so that other card issuers can join the lawsuit.

According to the complaint, which you can read in full below, Apple makes more than $1 billion a year and charges credit card companies up to 0.15 percent per transaction in Apple Pay fees, yet the card issuers themselves don’t have to pay anything when customers use their “Android wallets.” functionally identical. The lawsuit alleges that Apple is violating antitrust law by making Apple Pay the only service capable of making NFC payments on its iPhone, iPad and Apple Watch. It also says that Apple prevents card issuers from passing these fees on to customers, leaving it no incentive for iPhone owners to look for a cheaper payment method.

as we are Discussed extensively during Epic vs Apple ExperienceHowever, such a case could hinge on what the judge decides the relevant market might be — here, prosecutors say Apple has a monopoly on “Tap and Pay mobile phone cases on iOS.” But even if the judge agrees that this is true, he can still decide that there is no real monopoly because customers can always switch to Android, where there are other mobile wallets.

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Lawsuits do not automatically grant class action status – the judge has to decide whether or not to grant that. However, the law firm handling the Affinity case, Hagens Berman, has a track record with class action lawsuits against Apple; He was involved in getting developers $100 million settlement After claiming that the App Store rules were unfair, so with Ebook Price Determining Case That ended up returning Apple to customers around $400 million.

Purpose of the lawsuit press release From the law firm, is to change Apple’s policies that force all contactless payments to go through Apple Pay, and to have the company reimburse card issuers for fees that prosecutors claim they illegally charged.

This is not the only challenge Apple faces with how to operate Apple Pay. European Union recently intercepted To the fact that third-party developers cannot use the iPhone’s NFC system for payments, claiming that the restrictions lead to “less innovation and consumer choices for mobile wallets on iPhones.” Now, the company may face a legal battle over this issue in the US as well.

Apple did not immediately respond the edgeRequest to comment on the case.