Court rules in favor of Apple in class action over crypto payment policies Court rules in favor of Apple in class action over crypto payment policies
Plaintiffs in the class action can file an amendment within 21 days.
2 min read
Updated: Mar. 29, 2024 at 12:20 am UTC
Cover art/illustration via CryptoSlate. Image includes combined content which may include AI-generated content.
A California judge dismissed a class action lawsuit against Apple that accused the tech giant of imposing restrictions on third-party crypto payments on March 26.
District Judge Vince Chhabria said the complaint contained “several fatal problems,” including inadequately alleged agreements between Apple and other payment services.
He expressed doubts that the agreements restricted decentralized crypto transactions as alleged, asserting it is not clear that such an agreement would be unlawful under the Sherman Antitrust Act.
Meanwhile, the allegations of antitrust standing were found to be inadequate because any links between Apple’s alleged anticompetitive behavior and alleged injury were speculative. The plaintiffs claimed they paid overinflated fees to certain third-party apps because of Apple’s agreements.
Furthermore, the case had problems with its relevant market definition because Zelle — a payment app mentioned by the plaintiffs — was excluded from the definition.
The judge observed other issues and said an amendment to the case was unlikely to change the outcome of the lawsuit. However, the court has given plaintiffs 21 days to amend the case.
The case will be dismissed without prejudice if the plaintiffs fail to make amendments by the deadline.
Centralization vs. decentralization
Initially filed in November 2023, the lawsuit alleged that PayPal‘s Venmo, Google Pay, Cash App, and Apple Cash all agreed to Apple’s store guidelines, thereby agreeing to terms preventing each app from supporting decentralized crypto transactions.
Apple asked for the class action lawsuit to be dismissed in February. That request made most of the same points confirmed in the judge’s current dismissal.
Aside from their broader legal arguments, Apple’s defense asserted that the plaintiffs’ claims were factually incorrect, writing:
“There are apps in the App Store that facilitate decentralized [crypto] transactions.”
The defense added that a particular rule, App Store Guideline 3.1.5, requires third-party apps to handle transactions through an approved exchange and “does not apply to, much less categorically prohibit” apps that offer decentralized crypto transactions.
Plaintiffs initially argued that the same section undermines decentralization by requiring the involvement of intermediary exchanges.
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Mike Dalton
Before transitioning to crypto writing in 2018, Mike studied library and information sciences. Currently, he resides on Canada's West Coast.
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Apple
Apple is a multinational American technology company with its main office in Cupertino, California.
PayPal
PayPal is an American multinational financial technology firm that operates an online payment system in most countries that permits online money transfers and serves as an electronic replacement for conventional paper methods like checks and money orders.
Google LLC is an American multinational technology company that is most commonly known for its search engine that was founded by Sergey Brin and Larry Page in 1998.
Cash App is a mobile payment service developed by Square, Inc., allowing users to transfer money to one another using a mobile phone app.