A British Columbia Supreme Court judge has certified a class action lawsuit against Apple, marking a significant legal development in the ongoing scrutiny of the company’s search agreement with Google. The ruling allows the case to proceed on allegations that the deal stifled competition and allowed Google to charge artificially inflated advertising prices.
Competition Act Violations Alleged
The lawsuit, originally filed in 2021 by Spark Event Rentals Ltd., an event rental company based in British Columbia, centers on the financial impact of Google’s dominance in the search market. The plaintiff alleges that Apple and Google conspired to limit competition, enabling Google to charge supracompetitive prices for search ads.
Justice Thomas, who issued the certification ruling, found sufficient grounds to examine whether Google’s payments discouraged Apple from developing its own search engine. The court determined that the pleadings raised a common purpose to perform an act prohibited under section 45 of the Competition Act. Justice Thomas noted that it was not clear and obvious that the plaintiff had failed to plead an agreement between the two tech giants not to compete in the search engine market.
The ruling relies heavily on evidence presented during the recent United States Department of Justice antitrust case against Google. That federal case resulted in an August 2024 ruling that Google had illegally maintained its monopoly through anticompetitive agreements, including its deal with Apple. Justice Thomas cited testimony from Apple executives Eddy Cue and John Giannandrea to support the inference that Apple did not compete with Google because of the revenue-sharing agreement.
Scope of the Lawsuit and Damages
Apple has consistently argued that its agreement with Google is a legitimate distribution arrangement rather than an unlawful conspiracy. The company has described itself as an innocent bystander in the broader antitrust battles targeting Google, maintaining that Google is the appropriate defendant for search market issues.
The current case names Apple as the sole defendant. The plaintiff originally named both companies but dropped Google following a dispute over an arbitration clause in its advertising contracts. Justice Thomas acknowledged that the plaintiff had cherry-picked evidence to support the case but ruled that this approach was appropriate at this stage of the proceedings.
The class action covers Canadian residents who purchased search ads from Google since 2005. This date marks when Apple and Google first agreed to make Google the default search engine on Safari in exchange for a share of advertising revenue. The lawsuit seeks financial compensation for advertisers who allegedly overpaid for these ads. The court has also allowed the question of punitive damages to proceed.
This certification does not establish that Apple engaged in anticompetitive conduct. It simply allows the allegations to move forward toward a trial. No date has been announced for the trial proceedings. The case adds to a growing list of regulatory challenges Apple faces globally, with similar concerns under scrutiny in the US, UK, Australia, the EU, and Japan.
Source: 9to5Mac
