Apple’s App Store Can Reject Unwanted Apps–Coronavirus Reporter v. Apple

Apple rejected two of the plaintiffs’ apps, “Coronavirus Reporter” and “Bitcoin Lottery,” for its app store. Apple rejected the Coronavirus Reporter app because it wasn’t associated with a government entity or medical institution; and it rejected the Bitcoin Lottery app due to its general ban on bitcoin apps. Apple’s developer guidelines expressly say Apple can reject apps in its sole discretion. Nevertheless, the plaintiffs sued Apple for antitrust and other violations. Prior blog post.

Sherman Act. The appeals court says the plaintiffs “have not adequately defined the relevant market.” Instead, they identified 15 different markets in “scattergun fashion.” (Jargon note: the term “scattergun fashion” has appeared in 16 opinions in Westlaw). Also,

Antitrust law does not seek to punish economic behavior that benefits consumers. Disapproval of these two apps on grounds ostensibly designed to protect consumers, absent factual allegations to believe that these disapprovals occurred for pretextual reasons, does not suffice to demonstrate anticompetitive conduct. Further, Plaintiffs-Appellants have not explained why or how they could not distribute their apps by other means, even if not by their most preferred means.

Contract Breach. Apple has the sole discretion to accept or reject apps, which is a hard provision to breach.

Implications. Antitrust law is a terrible tool for regulating content moderation, and it was never designed to let unwanted app developers force their way into app stores. It’s like saying that book publishers should have a mandatory right to be sold in bookstores that don’t want to carry them. Not only is that terrible policy, but it blatantly disregards the First Amendment. This court doesn’t reach the obvious First Amendment issues, instead rejecting the case mostly because of its poor pleading.

While this court reached the obvious result, the antitrust/app store carriage issue remains of interest in DC. Politicians, including Sen. Klobuchar, have pushed bills that would expand antitrust law to usurp editorial discretion by app stores. I wonder if making sketchy “coronavirus” and bitcoin apps more widely available is the kind of problem that Sen. Klobuchar hopes to solve? Again putting aside the obvious First Amendment problems with such bills, lawsuits like this remind us yet again that the sketchiest apps will be the most enthusiastic embracers of any new antitrust weapons Congress creates.

Case citation: Coronavirus Reporter v. Apple, Inc., 2023 WL 7268325 (9th Cir. Nov. 3, 2023)