Federal Judge Certifies Class Action Against Apple Over Apple Pay Fees
Federal Judge Certifies Class Action Against Apple Over Apple Pay Fees #
A federal judge in California has cleared thousands of US banks and credit unions to pursue a collective antitrust lawsuit against Apple over the fees the company charges card issuers for Apple Pay transactions.
US District Judge Jeffrey S. White issued the class certification order on September 23 in the Northern District of California, according to a press release from Hagens Berman, one of the law firms representing the plaintiffs. The ruling allows the case to advance on a classwide basis rather than through individual claims, and simultaneously rejected Apple’s bid to exclude expert testimony central to the plaintiffs’ antitrust theory.
The certified class encompasses all US entities that issued any payment card enabled for Apple Pay and paid Apple a fee on transactions made with that card. The plaintiffs’ attorneys estimate thousands of financial institutions qualify, a figure Apple did not contest when the court evaluated the numerical threshold for certification. Named plaintiffs are three credit unions, represented by Hagens Berman and Sperling Kenny Nachwalter LLC, with the court also appointing Hagens Berman as co-class counsel.
The lawsuit centers on Apple’s practice of charging card issuers 0.15 percent of the value of each credit card purchase processed through Apple Pay, plus half a cent per debit transaction. The plaintiffs argue Apple was able to impose these fees because it blocked rival mobile wallets from accessing the iPhone’s near-field communication hardware, leaving Apple Pay as the sole contactless payment option on iOS devices. The suit contends this exclusivity enabled Apple to extract what it characterises as supracompetitive fees, potentially totalling up to one billion dollars annually in violation of federal antitrust law.
Judge White found that questions of whether Apple held monopoly power, whether it harmed competition, and whether card issuers were injured as a result can be resolved for the class as a whole rather than case by case. He also denied Apple’s motion to exclude the plaintiffs’ damages expert, whose testimony the court said provides common proof of Apple’s alleged monopoly position in tap-and-pay iOS wallets as well as the broader mobile wallet market. The plaintiffs are seeking both reimbursement for historical fees and an injunction against the challenged practices.
The case, first filed in 2022, does not yet determine whether Apple violated antitrust law or owes damages. Apple has denied the allegations. “We are pleased with the ruling and look forward to next steps of litigation,” said Steve Berman, co-founder and managing partner of Hagens Berman.
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