Insights from the Supreme Court's Apple v. Pepper Decision
In May 2019, the U.S. Supreme Court issued a 5–4 decision in Apple v. Pepper, one of the Court's most significant antitrust rulings of the last several years. In a majority opinion authored by Justice Kavanaugh, the Court held that iPhone owners who purchased software applications ("apps") from Apple's App Store are "direct purchasers" and therefore have standing to sue Apple for alleged monopolization of an aftermarket for iPhone apps.
The Apple opinion narrows the so-called Illinois Brick defense, expands opportunities for private antitrust litigation, and warrants careful assessment by retailers, distributors, and companies operating electronic marketplaces. While some companies might consider restructuring distribution arrangements to mitigate increased exposure from this decision, such restructuring could undercut an efficient business model.
Jones Day publications should not be construed as legal advice on any specific facts or circumstances. The contents are intended for general information purposes only and may not be quoted or referred to in any other publication or proceeding without the prior written consent of the Firm, to be given or withheld at our discretion. To request reprint permission for any of our publications, please use our “Contact Us” form, which can be found on our website at www.jonesday.com. The mailing of this publication is not intended to create, and receipt of it does not constitute, an attorney-client relationship. The views set forth herein are the personal views of the authors and do not necessarily reflect those of the Firm.