Judge James Donato of the United States District Court for the Northern District of California exponentially increased Google’s damages exposure by recently granting class-action status to more than 21 million consumers in a suit alleging that the Google Play app store has abused its power over the sale and distribution of Android mobile applications, violating U.S. anti-competition laws and allowing it to collect exorbitant fees.
Judge Donato said in a 27-page order that the plaintiffs had established the legal elements of "commonality" and other factors to form a class action that alleges anticompetitive business practices.
At stake in the case are the billions of dollars in revenue generated by Google Play.
Google, meanwhile, has defended its app store business practices and denied the claims in the case. “We’re evaluating the ruling and, after that, we’ll assess our options,” a Google spokesperson said.
In an attempt to argue against class-action certification, attorneys for Google said the plaintiffs failed to show how they were harmed. However, Judge Donato rejected this argument.
Attorney for Google Justin Raphael also argued against letting the case proceed as a class action because, he claimed, there are too many differences in app transactions to group users together. For instance, apps have varied pricing and cost structures.
Included in the class-action suit are Google Play users since August 2016 located in 12 states (including Ohio, Michigan, and Georgia) and American Samoa, Guam, the Northern Mariana Islands, Puerto Rico, and the U.S. Virgin Islands who were not represented in a suit filed in July 2021 by state attorneys general.
The class-action claims Google intentionally inflates Android app prices by typically taking a 30% cut of all sales in its app store. And in terms of the company’s anti-competitive conduct, Google would “offer discounts, more subsidies in the form of rewards” to bring users to its marketplace, Karma Giulianelli, an attorney representing consumers, told Judge Donato.
Attorneys for the plaintiffs also allege that Google prohibited app developers from directing customers to competitors and used "misleading warnings to deter customers from downloading apps outside the Google Play Store."
The attorneys claim that "but for Google's anticompetitive conduct, plaintiffs and class members would have paid lower prices for apps and in-app purchases and would have benefited from expanded choice."
The trial is scheduled to begin June 2023.
