Third-Party App Developers in UK Sue Apple for $2.7 Billion Over Tracking Restrictions

The entrance to the Apple store in Brussels on July 2, 2021. Yves Herman/Reuters

Thousands of British app developers filed a $2.7 billion lawsuit on Thursday against Apple over its App Tracking Transparency (ATT) framework, claiming the service was designed and implemented unfairly and resulted in significant losses for their businesses.

The class-action lawsuit, led by Ann Pope with the Hausfeld law firm, claims that Apple’s framework held third-party apps to tracking restrictions that were tougher than those faced by Apple’s own ad operations, putting the outside developers at a competitive disadvantage.

Apple introduced the ATT framework in 2021, which third-party developers are required to use if they collect user data and share it with other companies. The tracking feature triggers a pop-up box that typically requires users to choose if they want the app to track their activity or “ask app not to track.”

They must also get additional consent through a prompt defined by Apple.

The same rules, however, don’t apply to Apple’s own offerings, and Apple uses its own prompt to request user consent to personalized advertising, according to the lawsuit.

“Privacy is an important protection for consumers, but it should be applied fairly and in a way that ensures businesses of all sizes can compete on a level playing field,” said Pope. “It cannot become a reason for digital platforms to play by one set of rules while forcing app developers to play by another.”

Pope said the lawsuit is important to protect the rights of British businesses that depend on Apple and to ensure that the rules Apple applies are fair. The claim also is meant to compensate the losses to British companies from Apple’s actions.

Many app developers in the UK are small businesses, with about 70 percent of them employing 10 or fewer people, according to Hausfeld.

“Many of these businesses rely on digital advertising and app discovery tools to attract users and sustain free-to-use services,” Hausfeld stated. “They have also faced commercial pressure from App Store fees, restrictions on steering users to alternative payment options, and limitations introduced under ATT.”

Regulators in other countries, including France, Italy, Germany, Poland, and Romania, have also investigated Apple’s implementation of ATT.

A German investigation resulted in Apple agreeing to ensure that third parties are treated equally by removing potentially discouraging wording and symbols, and making the consent process clearer and more neutral, according to Hausfeld.

Apple didn’t return a request for comment about the lawsuit before this article was published.

An Apple iPhone 11 Pro. Grinvalds/Getty Images

The changes allow developers to offer other payment options along with Apple’s payment system. They can also distribute through third-party app stores or directly from their websites.