Apple Seeks to End iTunes Antitrust Class Action Lawsuit

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On Wednesday, Apple Inc. submitted a motion for summary judgment requesting the presiding federal judge to put an end to the consumer antitrust class action lawsuit alleging that the popular multinational tech company had created a monopoly of the digital music market through their iTunes program.

The iTunes antitrust class action lawsuit filed by a consumer in California federal court and was given consumer class certification in back in 2008. According to the Apple class action lawsuit, “the 2006 [iTunes] update, which prevented digital music from one insignificant source of music … from being played directly on iPods, forced RMS [RealNetworks Music Store] customers to buy music from Apple instead of RMS to play on their iPods, and they bought so much music from Apple that if and when they needed to replace their iPods, they were locked in to buying an iPod rather than switching to a competing device as they supposedly would have done if only they had continued to buy music from RMS.”

Apple’s legal counsel urged U.S. District Judge Yvonne Gonzales Rodgers to put an end to the iTunes class action lawsuit because, they argue, the plaintiff’s allegations are based on supposition not grounded in actual facts or figures. In this motion for summary judgment, Apple has also asked to exclude the plaintiff’s expert testimony given by Dr. Rodger G. Noll.

Dr. Noll is an economist who, according to the Apple class action lawsuit, created a regression model supporting the plaintiff’s allegations that the iTunes program forced them consumers to buy iTunes and Apple products, while edging out competitors like RMS. The Apple antitrust class action lawsuit also alleges that based on the Apple monopoly business practice, the tech giant was able to increase iPod pricing.

In their motion for summary judgment of the antitrust class action lawsuit, Apple states, “The regression purports to tease out a supposed incremental price effect of the 2006 update from the multitude of factors that determine iPod pricing. But the regression is riddled with fundamental errors and inconsistencies that render it unreliable and unable to support any finding of impact.”

Additionally, Dr. Noll’s estimates for his regression model is based on an earlier iTunes update, the 2006 version in question. Apple argues that if the mistakes were removed from Dr. Noll’s models and figures, there would be “no obvious impact” on the digital music market.

Judge Gonzales Rodgers has urged both the defendants and the plaintiffs to provide more evidence, stating, “One of the biggest issues I have here is, what am I supposed to be trying? Why are there no customer surveys? You have experts — that’s the trial? There has to be a factual basis for expert opinions[.]”

The trial date for the iTunes antitrust class action lawsuit has been set for November 17 of this year, wherein both parties, but especially the plaintiff, will have to provide more concrete evidence to support their claims.

The plaintiffs are represented by Alexandra Senya Bernay, Bonny E. Sweeney, Carmen Anthony Medici and others at Robbins Geller Rudman & Dowd LLP.

The iTunes Antitrust Class Action Lawsuit is In re: The Apple iPod iTunes Antitrust Litigation, Case No. 4:05-cv-00037, in the U.S. District Court for the Northern District of California.

UPDATE: On Dec. 16, 2014, a jury handed down a verdict in favor of Apple in the iTunes antitrust trial, finding that the software upgrade was a genuine product improvement and was not intended to stifle competition.