The Vergecast - The lawyer who won against Apple at the Supreme Court

Episode Date: May 14, 2019

Apple just lost a case at the Supreme Court, and an antitrust lawsuit claiming that the App Store is a monopoly will proceed. Verge editor-in-chief Nilay Patel and senior reporter Adi Robertson speak ...to Mark Rifkin, one of the lawyers who argued the case against Apple.Subscribe to the Vergecast here for free in your favorite podcast appFor more on this case, check out Adi Robertson's recent work on The Verge  Learn more about your ad choices. Visit podcastchoices.com/adchoices

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Starting point is 00:00:59 dropping May 14th. Tap in with us. Hey everybody, it's the United from the Vergecast. This week's interview episode is a little bit different. We're going to do two parts. First, I have Addy Robertson here. Hey, Eddie. Hey.
Starting point is 00:01:11 So you may have heard Apple lost the case in the Supreme Court this week. The case is Apple versus Pepper. The plaintiffs were suing Apple for monopoly pricing in the app store. They're basically saying Apple's 30% cut is overpriced. Consumers are paying it. That's a problem. And the case in the Supreme Court very narrowly was not about that. It was about whether consumers could sue Apple at all. So Addy and I actually interviewed
Starting point is 00:01:34 the plaintiff's lawyer. We're going to talk to him in a minute. But it's so complicated that I just want to spend a few minutes with Addy explaining what the hell is going on. So Addy, what the hell's going on? So this is the simple version. We will get into the more complex version later. But basically, in 2011, Robert Pepper and other people said, look, if you buy an iPhone, you have one choice to buy apps. Apple only will let you buy apps in its app store. And it charges a 30% commission to developers. Therefore, these developers are probably passing the cost on to us consumers. So you have one choice.
Starting point is 00:02:13 You have to buy this thing here and this company is driving up the price. That's all going to be decided at some point far in the future, because what the last eight years have been about is whether they're allowed to sue. So there is a 1970s doctrine that was about bricks that says... About bricks. It's called Illinois brick. All right. And it says that if you are not a direct customer of someone who is running a monopoly, you cannot sue them.
Starting point is 00:02:38 The idea was that if somebody gets sued for antitrust, like literally every person who has ever dealt with them can't sue them. So in Illinois brick, it was, okay, if you bought bricks from this guy, you can sue. If you bought a house that was bought with someone else's contract work who then bought the bricks from someone else, you cannot sue. You cannot sue the brick manufacturer. Yes. So Apple's argument was, we make the bricks and you're the people with the house. We provide a platform to developers. The developers are our customers. And you are buying things from the developers who may or may not be charging prices that you may or may not want to pay. And this case yesterday, the ruling said, look, that's ridiculous. You are engaging in a transaction with Apple. And clearly this is not equivalent to some person far up. the chain. Apple, you're just splitting hairs. Let's let this thing continue. Yeah. The decision I read it was Kavanaugh on the four liberal justices, which is interesting because Kavanaugh is not a liberal justice in the Supreme Court. But it was the four liberal justices in Kavanaugh. Kavanaugh wrote
Starting point is 00:03:46 the decision. And he seemed, I would say, mad. Definitely annoyed. Like the last line of the decision is this is why we have antitrust law. He accused Apple of gerrymandering. Yeah. He's like, Apple's splitting hair. I mean, you should read it. Addy wrote a piece about it. You can read the link. It's short. It's eminently readable. I said yesterday I didn't tweet, Kavanaugh writes like a truck, which nobody under, I think trucks are fine, but he's just a very blunt. He likes beer. You know what I'm saying? Like he's a very forthright writer. So short sentences and he just barrels through him. So it's very readable. You seem really annoyed with Apple for trying to say, look, we just, we sell to developers the access to our
Starting point is 00:04:26 storefront. We don't sell apps to the consumer, which for my perspective is a ridiculous thing to say. Like, it's called the App Store. Consumers give their credit card to Apple. They buy apps from Apple. If you have a customer service problem, you talk to Apple. Is there any validity of the idea that Apple should be considered the brick company in Illinois brick? The dissent from this, which was written by Neil Gorsuch, their argument was... The other Trump appointee to the Trump. I mean, this is wild. This is a huge split already. So that argument basically said, look, there was a utility to this Illinois Brick Doctrine, and the purpose was so that you aren't required to face all of these lawsuits from all these different people. So now Apple is maybe the developers can sue them, maybe the customers can sue them, they don't know.
Starting point is 00:05:16 And so if you get to other more complicated retail setups, then, yeah, you have no idea who might sue you. you might end up coming up with these extremely arcane setups to avoid liability. Like you try to make clear that you are not the developer, like you are not the person the customer is dealing with in ways that make the whole system less efficient. That's the sort of counter argument. And that's also the people who oppose this, like the App Association, some other industry groups, are basically saying, look, you're going to open all these companies up to liability. And you're not really getting anything concrete in return.
Starting point is 00:05:50 Except the opportunity to sue them. That's something. Like the plaintiffs here got something. Their argument is that the opportunity to sue them is not necessarily going to get them much. It will not make the app store better. You will not see lower prices. Obviously, the majority of the court doesn't necessarily think that. And we have no idea whether the actual monopoly claim is true yet.
Starting point is 00:06:11 There's a first part of the case, right, with 18T involved? So this case actually grew out of multiple other cases. And originally this launched right around the time the iPhone did. And if you remember that point, the iPhone launched exclusively on AT&T. So they were also making the case that by only being able to get data and voice service through AT&T, that was its own kind of anti-competitive behavior, that got shut down. There were more lawsuits. Everything happened. And then eight years later, we've got this case that's narrowly tailored to the app store.
Starting point is 00:06:42 It does seem to me that saying a phone carrier shouldn't have exclusives just seems ridiculous to me. And fine, this case has wound its way up and down the courts, the Supreme Court now, but so much has changed in the intervening years that suing AT&T for having an exclusive of the iPhone in 2007 was like flatly ridiculous. But suing Apple for having a monopoly on App Store pricing in 2019, it just seems of a piece with everything else that's happening right now. It seems very timely. Do they just luck out? Possibly. It is always possible that the Supreme Court is theoretically influenced. by the prevailing winds of change, especially if one of the justices was appointed, like,
Starting point is 00:07:24 literally a year ago. So that is theoretically possible. There have also been antitrust cases going on for years and years. Yeah. But there is a larger moment now, right? Elizabeth Warren wants to break up all the big tech companies. She wants to break the app store apart from Apple. She said it very clearly.
Starting point is 00:07:41 There's Spotify in suing in Europe. There is just the general backlash to Facebook. in any way, shape, or form. Is this all of a piece? Is this a moment? Is this going to have some huge impact, do you think? Philosophically, this is definitely targeting some of the same big questions. It is also important to note that this does not have a bunch of ramifications for any reason you would sue a tech company. It's specifically dealing with one reason that people could not sue if they are part of a specific class in an antitrust case. If you want to sue Facebook for kicking you off or for mistreating you as a consumer or you want to
Starting point is 00:08:18 sue, or if you're a developer and you want to sue a platform, you have always been able to do that. This basically changes one specific thing. It does not change the larger landscape of the many, many, many legal challenges over various facets of tech companies. Yeah, I think that's actually really important to note. Like, the way Supreme Court precedents work and the way Supreme Court opinions work is they try to be as narrowly tailored as possible. And here we're literally applying a 70s era precedent. about the sale of bricks to the sale of applications on the iPhone. And it doesn't seem like you can spread that much wider than that at this point in time.
Starting point is 00:08:56 How does this track with what's happening with Spotify in Europe? Is it the same idea or is it different? I think that it is hard to necessarily compare the doctrines that we're dealing with here, especially because we're just dealing with literally whether you're able to sue. But Spotify, as far as I understand it, it was also sort of upset about subscription models, which are subtly different. Like at this point, Apple charges different rates for them. That's sort of in-app purchases.
Starting point is 00:09:20 It's not literally whether you can put a piece of software onto the phone. Right. Okay. So let's say, so Apple lost here. Pepper and everyone, because it's a class action. But Pepper and the plaintiff's class prevailed. They're going to sue again. Play it out.
Starting point is 00:09:38 Like, what happens next? Then we should talk to Mark and see what he has to say. But what do you think, like, the actual impact for consumers is going to be? So if we fast forward through all this and they decide, look, Apple is a monopoly, it is driving up prices, you should not be able to do this, then theoretically Apple is going to have to come up with a new model, potentially something that is more like the Android Play Store, which we'll hear more about later, where you have one main system that is the safest place to get your apps. That's the place that most people go to, but you can also maybe side load things or you can maybe have an alternative app store. And also, obviously, they want money for anyone who bought an app in the last many, many years. Yeah, you get the feeling that the lawyers here are not just after pure justice. They definitely want some cash out of the deal.
Starting point is 00:10:28 Okay. We come back. We're going to talk to Mark Rifkin, some managing partner at Wolf Haldenstein, the law firm that just beat Apple in the Supreme Court. I got to tell you, he's riding high. He just wanted the Supreme Court. So he's in a good mood. And we pushed him pretty hard. So check this out.
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Starting point is 00:13:28 Just explain who exactly you represent. Sure. I represent the plaintiffs in the case who are iPhone customers who also bought apps for their iPhones. But I also represent, more importantly, I also represent all the purchasers, wherever they may be, who bought iPhone apps for their iPhones. at any time since the phone was introduced in 2007. So if somebody's listening to this right now, they've got an iPhone, they bought an app last week. They're theoretically in your class. They are members of the proposed class.
Starting point is 00:13:58 That's right. Well, I hope ever – this is Mark. This is your lawyer. I'm sure it's nice for everyone to meet each other. It's nice to meet everybody. You had a big win this week at the Supreme Court issued a decision. The composition of the judges on the majority is very interesting. I want to talk with that.
Starting point is 00:14:16 But effectively, the Supreme Court said you and your class, the plaintiffs have standing to sue Apple for pricing the app store. Can you just sort of explain how we got here and what that decision means? Sure. There's a longstanding principle in antitrust law that only a direct purchaser from an alleged monopolist has standing to sue the defendant for wrongful conduct. and that was decided in a 1977 case called Illinois Brick. So literally what the Supreme Court decided yesterday was that under Illinois Brick, iPhone owners were direct purchasers of apps from Apple and thus had standing to sue Apple for the alleged monopolization of the market for the iPhone apps. And Apple's argument in the opposite was basically, no, you don't buy apps from us. app vendors show up, they put apps in the store, we charge them a fee, but you are
Starting point is 00:15:17 fundamentally buying apps from the software developer, and the Supreme Court threw that app. Apple said that they provided distribution service to the app developers, but that we were really transacting with the app developers on the app store, and the Supreme Court rejected that argument, saying that we shopped on the app store where Apple forced us to shop. We paid all the money to Apple directly because that's what Apple insists. And so under any plain language understanding of that transaction, we were direct purchasers of iPhone apps from Apple. For most normal people kind of coming into the case, all you've gotten to is, okay, we can sue you. You haven't gotten to Apple has a monopoly over the app store or that monopoly is leading to unfair outcomes, right?
Starting point is 00:16:09 I mean, that's the heart of your case, but you're just at, okay, we're allowed to sue you. Correct. What we have right now is we have the green light to be able to proceed with a litigation, but it's an important hurdle because it was the last roadblock that we had to clear before we're able to start with Merritt's discovery, which is the part of the case where we're going to try to collect evidence from Apple to prove our claim. So there's been a pretty dramatic shift in a tech landscape, in how the big tech companies are perceived.
Starting point is 00:16:39 between then and now. Certainly 2007 and now is a drastic shift, but even 2011 and now, that's quite a long time. The sort of antitrust activity in interest in big 10 companies is going up. You have Elizabeth Warren saying she would break up Apple or split them apart from the app store. Is there anything, do you see that affecting the case in this moment? Yeah, I think that as time has gone on, and we've seen, especially over the last, eight years since we refiled the case in 2011. We've seen explosive growth in the app store. And that doesn't just reflect the growth in the popularity of iPhone apps. It also reflects Apple's iron fisted control over the distribution of the apps. If you want, the plaintiff's alleged in our case,
Starting point is 00:17:31 if you want to put an app on your iPhone, you have only one choice, and that's to shop, to shop, for the app on the app store. And as Justice Kavanaugh wrote in his opinion yesterday, the only other choice you have is not to put apps on your iPhone. And so I do think that the concentration of control in the hands of a single company, whether it's Apple or any other company, is going to help us not just to prove our case, but I think also to be able to demonstrate that this is the wrong sort of thing for e-commerce and for the economy generally. So there's obviously some technical limitations to putting an app on a phone, right? Apple has to have a store.
Starting point is 00:18:21 Are you suggesting that there should be injunctive relief and Apple should be allowed to have other stores on the phone? We are asking for an injunction to stop what we think is the unlawful monopolization of the distribution network for iPhone apps. Take the Android paradigm. You can, if you want, you can shop on Google Play for an Android app. But you don't have to. You can buy an app directly from an app developer. You can buy an app from another website. You can buy an app from many other locations. You don't need to go to Google Play to put an app on your Android device. The only reason you need to go to the App Store to put. an app on your iPhone is because that's where Apple wants you to shop. And the reason for that seems pretty obvious to us. The plaintiffs allege it's so that Apple gets to charge a super competitive price for the apps. Obviously, Apple made a bunch of arguments as to why. The first one
Starting point is 00:19:25 is this is how we validate the security and safety of iPhone customers. The second is, well, if you don't like it, you can go buy an Android phone. And the third is, and in fact, most people in the world have bought Android phones, right? The iPhone is not the dominant platform by any measure. Now that you are able to sue Apple, how are you going to attack those arguments? Let's take the last one first. This is a case that only relates to applications for the iPhone. It's what's known as a single product market. And when you make the choice to buy an iPhone or an Android phone, you lock yourself into one economy or the other. You can either start to buy Android apps for your Android phone or iPhone apps for your iPhone.
Starting point is 00:20:09 But if you buy an iPhone, you can't buy Android apps and vice versa. So when you make that decision to buy the phone of your choice, you now have to shop for the apps that work on that phone. Unlike the Android model where you can shop anywhere for an Android app, in the iOS. iPhone world, you have to shop at the App Store. So that's number one. Number two, with respect to the idea that what you're paying for is Apple's security features or somehow their value add, that'll be their defense and that'll be their justification for what they do. And we're perfectly prepared to meet that. We don't think that they'll be able to prove that they provide any significant value by forcing consumers to shop on a single source for iPhone apps.
Starting point is 00:21:00 But that'll be up to them to try to prove that. And the notion that they have some small fraction of the market, it's nonsense. It makes no sense to us at all. Why does that make no sense to you? Because they have locked the phone completely with features they built into the phone so that if you want to shop for an iPhone app, you have no choice.
Starting point is 00:21:24 You can't buy it anywhere else. You're forced to buy it on the app store. So you're saying that the fact that Apple only has, you know, some sub-50% share in the U.S. is not important, right, because they have 100% share of iPhone owners. Exactly. You've put your finger on it exactly. The fact that they have a 50% market share of smartphones doesn't, mean they don't have 100% share of the distribution of iPhone apps, which they absolutely do.
Starting point is 00:22:00 It is a near-complete perfect monopoly for the market for iPhone apps, which is the relevant market in our case. But isn't that, just to push you in this, isn't that what people are buying, this self-contained product where Apple controls the distribution? If a consumer is unhappy about this, you know, their cell phone contract is going to roll over in two years and they can just go buy an Android phone. Yeah, but you've already got an enormous investment of money in, in the device itself, and you've got a significant investment of money in the apps that you put on the phone, and that investment makes it much more difficult for you
Starting point is 00:22:39 to switch to another model. And frankly, it's no defense to a claim that Apple unlawfully monopolizes the market for iPhone apps to say that you can switch two years from now, if you want to absorb all those costs to do so. That doesn't justify Apple charging a super competitive price for apps on the App Store. So how far do you think the arguments that you're making here generalize to other platforms? You'd mentioned Android, Android does things a bit different, but say, do you see someone being able to sue Android for a certain form of exclusivity? Does this generalize to, say, a gaming console? Should Microsoft be required to add sort of alternate Xbox stores?
Starting point is 00:23:19 Yeah. So I think the answer to the question is the principles that we are looking at. Certainly the court's decision yesterday is generally applicable to any other platform. It's not related to this is not an Apple-specific or iPhone-specific decision. It's a general decision, and I think for that reason, it's an important decision protecting consumer rights under the antitrust laws. The court, the majority, that is, Justice Kavanaugh writing for the majority, said two or three times. how important it is to the Supreme Court that consumers be allowed to vindicate their rights under the federal antitrust laws. So that's number one.
Starting point is 00:23:59 Number two, as a practical matter, in the smartphone space, Apple really goes about its business quite unlike the way the Android market goes about its business. Google, for example, Google lets you buy apps for Google phones and you can buy an app for Google phones, and you can buy an app for a Samsung phone anywhere you want. You don't have to buy an app from Google Play. And so I think in the real world right now, at least, the only company that does business the way Apple does business is Apple. I mean, outside the world of phones, how much do you think that if, say, the merits of this case, you win on them, this applies to other parts of the tech industry, to say web platforms that are marketplaces or, again, like I'm mentioned to gaming consoles, to sort of other lockdown tech devices. How far does this go?
Starting point is 00:24:55 Well, I think the principle that the court announced that a consumer who buys directly from an alleged monopolist and pays his or her money directly to the alleged monopolist for the monopolized product has standing to sue that defendant under the federal antitrust laws, I think that principle is a general principle, and it would apply in any e-commerce setting. Let me make that more specific. So, Adi brought up the Xbox. You can only buy Xbox games digitally from Microsoft. And then you can also go buy a disc, right, from another retailer.
Starting point is 00:25:37 And plus you get the discless Xbox. Yeah, I was going to get there. But now there is a discless Xbox that Adi just mentioned. So now there's an Xbox where you can only buy games. is digitally from Microsoft. Do you think those consumers under this ruling have standing to sue Microsoft for being about it? You're going to have to forgive me because I don't know enough about the Xbox platform to be
Starting point is 00:25:59 able to answer the question with 100 percent certainty. But if what you're telling me is that in order to put a game on your Xbox console, you have to buy that game from Microsoft. you have to shop on a platform that Microsoft makes you shop, and you pay your money directly to Microsoft. I think under the court's decision in Apple versus Pepper yesterday, if there were any competitive conduct there, a consumer could sue Microsoft for that any competitive conduct as a direct purchaser from Microsoft. Let me just try to make this split really clear. So before a week ago, every Xbox had a Blu-ray drive, and you could go to
Starting point is 00:26:45 Best Buy and you could buy an optical disk and put it in Xbox. That under your reading of the decision yesterday means that there's two retailers for software for the Xbox, right? And they would be, presumably they would be competitors, correct? Even though Microsoft has to approve every game that runs on the Xbox. Because you can buy the game from Best Buy and you can buy it from Microsoft and you can buy it from Amazon, it's fine because there's at least some competition in the retail space. Now there's an Xbox without a disk drive. It just came out. That one, obviously you can only buy the games digitally from Microsoft, because that's the only digital storefront. You're saying that would fall
Starting point is 00:27:27 into this ruling theoretically. Let me see if I can be a little bit more precise about that. The principle that the court announced yesterday is just a standing principle, and that's that if someone alleges that Microsoft is a monopolist, and someone alleges that the market it monopolizes is the market for games for the Xbox console. Like we allege that Apple is a monopolist, and we allege that the market is the market for iPhone applications. It has to be very specific, and in antitrust law,
Starting point is 00:28:02 you really need to look at a couple of things. You need to look at who the monopolist is, and you need to look at what the market is. But if we're saying that the market is games for Xbox, consoles, then there's still competition because you haven't told me that there's a different market for the digital games versus the Blu-ray disc games. If there's different markets, in other words, you know what I'm saying? Yeah. Are the same games available either digitally or on Blu-ray, or are there different games that are available only on Blu-ray and not on
Starting point is 00:28:39 digital platform and vice versa, only on digital platform. There are definitely some digital only games. Yeah. The market has to include all reasonable substitute products. So if the market is purely digital and Microsoft is engaging in some kind of monopoly conduct, then yes, if you're forced to buy from Microsoft and you buy your product from Microsoft and you pay your product from Microsoft and you pay your money to Microsoft. and the market is just those games that Microsoft distributes electronically, then I think you have standing under the Supreme Court's decision yesterday,
Starting point is 00:29:16 you would have standing to sue Microsoft for that alleged monopolization. But I don't know nearly enough about the platform or that market to be able to say whether I think there's a claim or I don't think there's a claim. It's just a question of standing. And the Supreme Court said yesterday, it's a simple, bright line test. did the consumer buy directly from the alleged monopolist and pay his or her money directly to the alleged monopolist? If the answer to those two questions is yes, then that consumer has standing to sue that alleged monopolist. I can't begin to describe what the claim may be, but at least I can tell you that's the answer to the standing question.
Starting point is 00:29:56 Got it. Sorry to be so technical, but it's a really narrow technical decision that the Supreme Court reached yesterday. No, I appreciate it. This show is all about nerdy out and this stuff. So it's good. Okay, good. I actually want to ask you about the decision and the composition of the majority. You had the four liberal justices and Kavanaugh.
Starting point is 00:30:15 And he actually split from Gorsuch in particular, who is regarded as an equally deeply conservative judge. How did you get Kavanaugh to come over to the liberal side of the majority there? I'm always hesitant to use the labels liberal and conservative because I don't think that they apply equally in every setting. And I think this is this is a setting where Justice Kavanaugh saw an interpretation of a statute and of the Supreme Court's 42 years of precedent now under that Illinois brick rule that I told you about before the way we saw it. And I think it's it's the correct way to see it. The court has consistently said, we look at the structure of the transaction. We look at who buys the monopolized
Starting point is 00:31:10 product from whom, and we give standing to the person who deals directly with the alleged monopolist. And applying the principle, the way the court has applied it for 42 years, in this case, that points to the consumers who buy the apps from Apple on the app store and pay their money, to Apple through the App Store, they have standing. And that's exactly what the five justices on the court said yesterday. The fact that there's a disagreement about how the principle should be applied and it seems to fall on the left-right spectrum, I think that's just coincidence. I don't think this is a liberal or conservative kind of an issue. And I don't think you can look at the opinion and say that Justice Kavanaugh switched sides in any real meaningful sense.
Starting point is 00:32:03 I think it's just how you look at the statute and the case law that the Supreme Court has decided for 42 years and see how the case was decided that way. Right now, Spotify is suing Apple in Europe for a very similar idea, right, which is they're being illegally held out of the store, being illegally priced out of the store. That just comes from a different theory of antitrust, a different theory of competition. It's maybe started from a common predecessor with us, but it has diverged rapidly. Do you think those, is that going to help you out? You're inevitably going to end up back to this report again when you actually litigate the merits here.
Starting point is 00:32:41 Do you think that the activity in Europe is going to help you out in the United States? No, I don't think so. I think the laws and the traditions are very different. I do think that atmospherically, it helps us because everybody now is looking at Apple. And so I think from that standpoint, from the idea that, you know, Apple is coming under closer and tighter scrutiny all over the world. I think that's a helpful fact, but I don't think it helps us on the merits of the case. So if Apple offers you a settlement, let's say it's a very good settlement.
Starting point is 00:33:12 Do you take it or do you want this to go all the way up the courts and set a precedent? I think what's important here is that, first of all, we set an important legal principle. We clarified an important legal principle yesterday. The Supreme Court's decision was a very important one because it's very pro-consumer and it's very consumer protective in an environment where consumers are increasingly losing their rights to big corporations. I think that the Supreme Court's decision yesterday was a sea change in that trend, number one. Number two, we have been litigating this case for 12 years, and we are committed to litigating this case through trial and all the appeals that Apple will throw our way. That said, that said, if Apple is prepared to provide meaningful relief to consumers that end the unlawful practice and compensate consumers for their injury, then we would be foolish not to. to listen to that kind of an approach.
Starting point is 00:34:21 So wait, I just want to be really clear about that. You said end the unlawful practice and then compensate consumers. So if Apple shows up and they do the classic class action thing where everybody got an iPhone gets $4.20, that's not good enough. You want them to actually change how the iPhone works. You want them to open it up to other stores. I think they need to change the way they're doing business. You will not settle for anything less than the button that says allow other app stores
Starting point is 00:34:46 on iOS. I can't predict what the first. future is going to hold in this case. I don't know how the law is going to develop. I don't know how the evidence is going to unfold. But I will tell you that we are not interested in making the problem go away for Apple. We're interested in protecting the rights of the consumers who we've been representing for 12 years. So I just want to push on that one last time. And then, you know, you've given us so much your time. So this is how computers work now, right? There's a world, like an iPhone, an Xbox, a PlayStation,
Starting point is 00:35:22 largely what you are buying is access to a library of software, right? You're buying a piece of hardware that can run software that is approved and vetted by a large company on your behalf. If you buy an Amazon Fire tablet, you get the Firestore and you don't get the Play Store. If you buy an Android phone, the vast majority of consumers is never going to hit the button that says allow software from outside the Play Store.
Starting point is 00:35:47 mostly what they're selling, the value proposition of these devices of modern smart mobile devices in particular, is related to the existence of the store that is integrated with the device. I'm not sure. I'm not sure I agree entirely with that. I think there are plenty of devices, computers being a perfect example. You don't buy, when you buy Adel, you don't buy software that's written for Adele. You buy software that's written for a PC, and it's true that most software now is written for PCs and for Macs interchangeably, so that the same software is compatible with both. But I understand your question that in some instances, you're buying a system. You know, you're buying VHS or Beta Max or whatever it may be.
Starting point is 00:36:39 I get that. I understand that. A smart TV that runs the Roku OS. I don't think that you can go out in the world and find another app store for it. I mean, like, the implication of the standing here is actually much larger than, okay, now you can sue. It basically implicates the entire model of software distribution that has arisen its physical media has gone away. But the principle here is very simple. It doesn't just because you have a platform that software developers going to have to be writing software for.
Starting point is 00:37:13 It doesn't mean that you get to be the only place you can buy it. And it doesn't mean that you get to be, by virtue of that control, that you get to charge a super competitive price for it. That's exactly what our antitrust laws are intended to prevent. And that's why, for example, you know that Microsoft had problems when it was embedding certain software in its operating system. Couldn't do it, the court said. There are limits to how much control a company like Apple can exert over the, the sale of secondary products that are used with the primary product that they sell, which in this case is obviously the iPhone.
Starting point is 00:37:55 Okay. The idea that we can litigate our way into smartphones working like laptops is actually where chess listeners know. That's very interesting to me. But that to me, it seems like the heart of the dispute that's coming, right? I think it's a major feature of the case is the extent to which Apple is entitled to control, not just the software that runs on its device, but also the sale of that software. Yeah.
Starting point is 00:38:22 And that's the issue that we're litigating. Okay. So the Supreme Court says, all right, you have standing. What happens next? You're back in the district court. What's the next turn for people who are watching? Well, technically, technically we have a shortstop in the Court of Appeals because that's where the, that's where the case last was when Apple petitioned for the Supreme Court to hear the appeal. So it goes back to the Ninth Circuit, and then it will only spend a short time there before the Ninth Circuit sends it back to the district court where we will then resume the litigation.
Starting point is 00:38:53 And that you're full on into discovery now. What's the next step? Then it's my belief that we will go back and we will begin merits discovery. That's right. Very exciting. How long do you think this is going to take? You started in 2007. It's 2019. Do we get a resolution in 2020 or are we looking at 2029? Well, let's hope it's not 2029, but I think 2020 is probably ambitious for the case to run its full course. But let's hope it's closer to 2021 than it is to 28. You think if Elizabeth Warren wins the presidency and implements her plan to break apart all the big tech companies, including Apple, she told me directly, that that would kind of end your case? If Warren's plan or not, but I'll take your word for it. Number two, if she breaks up Apple, that's all well.
Starting point is 00:39:45 good, it doesn't do anything to compensate the consumers we represent for the billions of dollars they've had to pay in super competitive prices for the last 12 years. So the answer would be no. Got it. Okay. Well, Mark, thank you so much for all of the time. And hopefully, as this case goes on, we'll get to talk to you again. Of course. Okay. It's a pleasure. Thank you very much for your interest in the case. All right. Well, that was Mark Rifkin from Wolf Aldenstein. We're going to have him back. He was fun to talk to you. Thank you to Addy. Thanks, Adi. Fun to talk about. Addie is reporting on this for The Verge.
Starting point is 00:40:20 You can see her articles in the show notes. I get the feeling we're going to be doing a lot more reporting on NIH Trust and Tech. So watch out for Addy on that. Big news. Why did you push that button with Caitlin and Ashley is back this week with season four? They're just going for it to start season four. They're talking about blue bubbles versus green bubbles. And Deeter Bone is on that episode.
Starting point is 00:40:39 So check that out. It's in the podcast stores, which are not Monopoly. And literally any podcast store. You can just go get it. So check it out. It's really fun. Okay. And you can subscribe to the Vergecast.
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