The devil is in the details of Apple’s policies, says Hagens Berman spokesperson
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A class action lawsuit has been filed against Apple in California’s Northern District, accusing the tech giant of “illegally taking advantage of payment card issuers through its Apple Pay policy”.
According to attorneys for Hagens Berman and Sperling & Slater, Apple received up to $1 billion in compensation annually in violation of federal antitrust law.
The violations are twofold, as Apple has not only linked its mobile devices and its own mobile wallet to push Apple Pay, but has also monopolized the tap-and-pay mobile wallet market on iOS.
In addition to the payment trial, Apple charges card issuers who use Apple Pay “supra-competitive fees” for services that are otherwise available for free on Android devices.
“When you compare the functionality of Apple Pay to mobile wallets available on Android devices – Google Pay, Samsung Pay – you are actually holding up a mirror; they are essentially identical,” said Steve Berman, co-founder and managing partner of Hagens Berman.
“And yet the same service on Android that card issuers pay absolutely nothing for costs them a combined $1 billion annually through Apple Pay.”
As things stand, Apple charges US card issuers 15 basis points in credit and 0.5 cents in debit for all transactions made through Apple Pay.
“At first glance, the Apple Pay fees printed on card issuers may seem small, but the devil really is in the details of Apple’s policies, and these fees add up,” Berman added.
Hagens Berman’s antitrust lawsuit, which represents a class of US credit unions and financial institutions, is aimed at compensating payment card issuers, in addition to seeking injunctive relief to counter Apple’s policies.
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