Pepper v. Apple Inc., No. 14-15000 (9th Cir. 2017)
Annotate this CasePlaintiffs, purchasers of iPhones and iPhone apps, filed suit against Apple, alleging that Apple has monopolized and attempted to monopolize the market for iPhone apps. The court held that plaintiffs lacked antitrust standing pursuant to Illinois Brick Co. v. Illinois. The court agreed with the Third and Tenth Circuits and read Rule 12(g)(2) in light of the general policy of the Federal Rules of Civil Procedure, expressed in Rule 1. The court concluded that any error committed by the district court in ruling on Apple’s motion to dismiss under Rule 12(b)(6) for lack of statutory standing under Illinois Brick, was harmless. The court explained that Apple is a distributor of the iPhone apps, selling them directly to purchasers through its App Store. Because Apple is a distributor, plaintiffs have standing under Illinois Brick to sue Apple for allegedly monopolizing and attempting to monopolize the sale of iPhone apps. Accordingly, the court reversed and remanded for further proceedings.
Court Description: Antitrust. The panel reversed the dismissal for lack of statutory standing of an antitrust complaint alleging that Apple, Inc., monopolized and attempted to monopolize the market for iPhone apps. Plaintiffs argued that Fed. R. Civ. P. 12(g)(2) barred Apple from raising in its fourth Rule 12 motion to dismiss a statutory standing defense omitted from prior motions to dismiss. Agreeing with the Third and Tenth Circuits, the panel held that as a reviewing court, the court of appeals should generally be forgiving of a district court’s ruling on the merits of a late-filed Rule 12(b)(6) motion. The panel concluded that any error in the district court’s consideration on the merits of Apple’s Rule 12(b)(6) motion to dismiss was harmless. Disagreeing with the Eight Circuit’s analysis in a similar case, the panel held that the plaintiffs were direct purchasers of iPhone apps from Apple, rather than the app developers, and therefore had standing to sue under Illinois Brick Co. v. Illinois, 431 U.S. 720 (1977). The panel concluded that Apple was a distributor of iPhone apps, selling them directly to purchasers through its App Store. The panel remanded the case for further proceedings. IN RE APPLE IPHONE ANTITRUST LITIGATION 3
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