Apple's music monopoly case may turn on a procedural issue

Does the link between iTunes and the iPod, coupled with Apple's strong position in the music download market, make it a monopolist? And is the case a likely candidate for class certification? As interesting as the antitrust issues may be, whether the case persists is likely to turn on whether the court agrees it may proceed as a class action.

Larry Dignan recently had an excellent overview of the antitrust tying case currently pending against Apple.  The case is pled as a class action, and the determination of whether class treatment is appropriate can often determine whether or not such a case will proceed.  The stakes are much higher for all concerned if the case is permitted to go forward as a class action.  If not, the chances of the case being dropped or quietly settled go considerably up.  So, while the antitrust claims may be the more intriguing/sexy part of the case, the procedural issue of class certification may prove to be more important.

In addition to alleging improper tying, the complaint (PDF) takes issue with the nature of Apple's disclosures about iTunes and the iPod.  This is potentially fatal to the plaintiff's class certification opportunity.  In a class action, common issues of fact and law must predominate over issues that may be unique to would-be class members.  Once you make the particular perceptions of individual plaintiffs a primary focus (as it seems to me this claim must), it's more difficult and less appropriate to certify a class.  (See generally Wikipedia's discussion.)

On the tying issue, should the parties get there, overall I like Apple's chances despite its market power in this arena.  Apple will be able to credibly argue that the tying is merely incidental to its success with iTunes and the iPod, which have won hearts and pocketbooks not because they are "tied" to one another or Apple's other offerings, but because, independently, they work well.  Additionally, Apple can argue these products aren't actually "tied" because one doesn't need an iPod or other Apple device to enjoy iTunes.  (This argument becomes tougher though when you reverse it; iPod owners basically need iTunes to make their devices function.)

Antitrust cases are notoriously complex (as are class certification issues), and this one should be no exception.  On the surface Apple makes a good target due to the undeniable links between its products, its share of the music download market, and the failure of iTunes and the iPod to interoperate with other devices and services.  But Apple has excellent counsel (Jones Day), and they'll have lots to work with in combating these claims.

(BTW, I'm a Mac user, own a little Apple stock, want an iPhone.  Etc.)

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