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Aussie app developers join class action against Apple, Google for alleged abuse of power

Last year, app users in Australia brought proceedings against Apple and Google, alleging misuse of market power. Now, app designers and founders are also taking on the tech giants, with two large plaintiff firms teaming up for the action.

user iconJerome Doraisamy 03 April 2023 The Bar
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California-based tech giants Apple and Google are, as of mid-last year, facing a consumer class action alleging that the companies abused their market dominance to inflate prices by forcing developers to use their platforms, increasing the cost of in-app purchases, as reported at the time by AFR.

Those proceedings, brought by Phi Finney McDonald and funded by Vannin Capital, submit that the two tech giants breached the Australian Consumer Law by way of forcing up prices by not allowing competitors to offer alternate, better value payment systems.

Now, Australian app designers and founders are joining the fight, following last month’s Federal Court decision to allow the existing proceedings to be expanded to include said stakeholders, who may have suffered loss or damage as a result of the supposed conduct of the tech giants.


National plaintiff firm Maurice Blackburn said, earlier this morning (Monday, 3 April), that it is representing the designers and founders, who are alleging that Apple and Google misused their market power to charge 30 per cent commissions on in-app spending, while also blocking competitors from offering better value payment systems.

The class action is now being run jointly by Phi Finney McDonald and Maurice Blackburn.

According to Phi Finney McDonald principal Joel Phibbs, Google and Apple are “quite rightly facing increased scrutiny from regulators”.

“And now, this landmark case gives consumers and app developers the opportunity to stand up to these global tech giants and seek compensation,” he proclaimed.

Maurice Blackburn principal Kimi Nishimura added: “This case is about an egregious misuse of market power by each of Apple and Google which should result in significant compensation being paid to app developers and consumers.”

The proceedings allege that Apple makes 55 per cent of smartphones sold in Australia, with the rest running on Google’s Android system.

Nearly two years ago, Apple settled a class action in the United States and allowed app developers to use alternative payment systems.