A Judge Rules an Apple Pay Fee Case Can Move Forward As a Class Action – Digital Transactions
A federal judge has ruled that a case brought by three financial institutions against Apple Inc. can proceed as a class action. The ruling, issued Wednesday by Judge Jeffrey White of the U.S. District Court for the Northern District of California, certifies the plaintiffs as a class while dismissing Apple’s move to exclude a damages expert put forward by the plaintiffs.
The years long litigation, in which the financial institutions argue Apple has excluded rivals to its own Apple Pay wallet for contactless transactions on the tech giant’s iPhone, now appears likely to proceed. Financial institutions in the case contend Apple’s exclusion of competing wallets has cost them as much as $1 billion yearly in transaction fees. Apple charges issuers 0.15% for credit card payments and half a penny for debit card transactions.
The plaintiffs also argue that by pursuing the alleged exclusionary practice Apple has maintained an illegal monopoly. Judge White’s ruling comes as plaintiffs point out that Google’s Android technology allows multiple wallets and collects no fee from issuers for contactless transactions.
Apple did not immediately issue a comment on White’s ruling. The tech giant opened the iPhone’s near-field communication chip to third-party developers with the introduction of iOS 18.1 in October 2024. Plaintiffs are seeking recovery of fees already paid.
The suit was filed in 2022 by Affinity Credit Union, Green State Credit Union, and Consumers Co-Op Credit Union, arguing Apple could not have maintained its fees in the face of competition. The plaintiffs are asking for the fees paid to be refunded, along with changes to Apple’s practices in the matter.
The certified class in the matter includes U.S. issuers of a card enabled by Apple Pay that paid Apple a transaction fee when the card was used. This class could run to thousands of financial institutions, according to the plaintiffs. Questions for the court include whether Apple enjoyed monopoly power and levied fees that harmed issuers.
