Case 5:20-cv-07079 Document 1 Filed 10/09/20 Page 1 of 57
`
`
`
`
`
`David Azar (State Bar No. 218319)
`dazar@milberg.com
`MILBERG PHILLIPS GROSSMAN LLP
`16755 Von Karman Avenue, Suite 200
`Irvine, California 92606
`Telephone: 212-594-5300
`Facsimile: 212-868-1229
`
`Peggy J. Wedgworth (pro hac vice forthcoming)
`pwedgworth@milberg.com
`Robert A. Wallner (pro hac vice forthcoming)
`rwallner@milberg.com
`Elizabeth McKenna (pro hac vice forthcoming)
`emckenna@milberg.com
`Blake Yagman (pro hac vice forthcoming)
`byagman@milberg.com
`Michael Acciavatti (pro hac forthcoming)*
`macciavatti@milberg.com
`*admitted only in Pennsylvania
`MILBERG PHILLIPS GROSSMAN LLP
`One Penn Plaza, Suite 1920
`New York, New York 10119
`Telephone: 212-594-5300
`Facsimile: 212-868-1229
`
`Attorneys for Plaintiffs and the Proposed Class
`
`
`UNITED STATES DISTRICT COURT
`NORTHERN DISTRICT OF CALIFORNIA
`
`1
`2
`3
`4
`5
`6
`7
`8
`9
`10
`11
`12
`13
`14
`15
`16
`17
`18
`19
`20
`21
`22
`23
`24
`25
`26
`27
`28
`
`
`
`
`
`
`
`DIANNE BENTLEY, JENNIFER GRACE,
`ADAN MOYA, CORESA TRIMBLE, and
`ROBERT WING, on behalf of themselves and
`all others similarly situated,
`
`
`v.
`
`GOOGLE LLC, GOOGLE IRELAND
`LIMITED, GOOGLE COMMERCE LIMITED,
`GOOGLE ASIA PACIFIC PTE. LIMITED, and
`GOOGLE PAYMENT CORP.,
`
`
`
`
`
`
`
`
`
`
`
`
`Plaintiffs,
`
`Defendants.
`
`
`
`
`
`CASE NO. ___________________
`
`
`CLASS ACTION COMPLAINT
`
`DEMAND FOR JURY TRIAL
`
`
`
`
`
`
`CLASS ACTION COMPLAINT
`
`

`

`Case 5:20-cv-07079 Document 1 Filed 10/09/20 Page 2 of 57
`
`
`
`
`
`TABLE OF CONTENTS
`INTRODUCTION ....................................................................................................................... 1
`JURISDICTION AND VENUE ................................................................................................. 1
`INTRA-DISTRICT ASSIGNMENT .......................................................................................... 2
`PARTIES ...................................................................................................................................... 3
`RELEVANT FACTUAL ALLEGATIONS .............................................................................. 4
`A. Google’s Domination Of The Market For Licensable Smart Mobile Operating
`Systems ............................................................................................................................ 4
`
`B. Google Unlawfully Maintains A Monopoly In The Android App Store Market ..... 8
`1. Android App Stores Constitute a Relevant Product Market ...................................... 8
`2. Google Monopolizes the Android App Stores Market ............................................ 10
`3. Google’s Anticompetitive Conduct in the Android App Store Market ................... 15
`a. Google’s Contracts with OEMs ...................................................................... 15
`b. Google’s Contracts with App Developers ....................................................... 16
`c. Google’s Restraints on Consumers ................................................................. 18
`d. Anticompetitive Effects in the Android App Store Market .............................. 21
`
`I.
`II.
`III.
`IV.
`V.
`
`
`
`
`
`C. Google Unlawfully Maintains A Monopoly In The Android In-App Payment
`Processing Market ........................................................................................................ 23
`1. Android In-App Payment Processing Constitutes a Relevant Product Market ........ 23
`2. Google’s Monopoly Power In The Android In-App Payment Processing Market .. 24
`3. Google’s Anticompetitive Conduct in the Android In-App Payment Processing
`Market ...................................................................................................................... 25
`4. Anticompetitive Effects in the Android In-App Payment Processing ..................... 26
`VI. ANTITRUST INJURY .............................................................................................................. 27
`VII. CLASS ALLEGATIONS .......................................................................................................... 27
`VIII. CAUSES OF ACTION .............................................................................................................. 30
`IX.
`PRAYER FOR RELIEF ........................................................................................................... 54
`X.
`JURY TRIAL DEMANDED .................................................................................................... 55
`
`
`
`i
`CLASS ACTION COMPLAINT
`
`1
`2
`3
`4
`5
`6
`7
`8
`9
`10
`11
`12
`13
`14
`15
`16
`17
`18
`19
`20
`21
`22
`23
`24
`25
`26
`27
`28
`
`
`

`

`Case 5:20-cv-07079 Document 1 Filed 10/09/20 Page 3 of 57
`
`
`
`
`Plaintiffs Dianne Bentley, Jennifer Grace, Adan Moya, Coresa Trimble, and Robert Wing
`(collectively, “Plaintiffs”), on behalf of themselves and all others similarly situated, bring this class action
`against Defendants Google LLC, Google Ireland Ltd., Google Commerce Ltd., Google Asia Pacific Pte.
`Ltd., and Google Payment Corp. (collectively, “Google”), and allege the following based upon
`information and belief, except as to those allegations that are based on Plaintiffs’ personal knowledge.
`I.
`INTRODUCTION
`1.
`This is an antitrust class action arising out of Google’s unlawful conduct concerning the
`Google Play Store, Google’s store for the distribution and sale of billions of applications (“apps”) and
`in-app purchases running on Android smartphones and other mobile devices utilizing the Android
`operating system. Through its acquisition and maintenance of an unlawful monopoly, and its
`anticompetitive contractual restrictions imposed on app developers, Google has forced consumers to pay
`supra-competitive prices for apps and in-app purchases on the Google Play Store. Although Google has
`publicly acknowledged “that developers should have a choice in how they distribute their apps and that
`stores should compete for the consumer’s and the developer’s business,”1 its unlawful conduct has
`prevented such choices and foreclosed competition, to the enormous detriment of consumers throughout
`the United States. By this action, Plaintiffs, on behalf of themselves and other consumers, seek monetary
`damages for injuries sustained from Google’s unlawful conduct, and injunctive relief enjoining Google
`from continuing its anticompetitive conduct.
`II.
`JURISDICTION AND VENUE
`2.
`This Court has subject-matter jurisdiction over Plaintiffs’ federal antitrust claims pursuant
`to the Clayton Antitrust Act, 15 U.S.C. § 26, and 28 U.S.C. §§ 1331 and 1337. The Court has
`supplemental jurisdiction over Plaintiffs’ state law claims pursuant to 28 U.S.C. § 1367.
`
`
`1Sameer Samat, Listening to Developer Feedback to Improve Google Play, ANDROID DEVELOPERS
`BLOG (Sept. 28, 2020), https://android-developers.googleblog.com/2020/09/listening-to-developer-
`feedback-to.html.
`
`
`
`1
`CLASS ACTION COMPLAINT
`
`1
`2
`3
`4
`5
`6
`7
`8
`9
`10
`11
`12
`13
`14
`15
`16
`17
`18
`19
`20
`21
`22
`23
`24
`25
`26
`27
`28
`
`
`

`

`Case 5:20-cv-07079 Document 1 Filed 10/09/20 Page 4 of 57
`
`
`
`
`3.
`This Court also has subject-matter jurisdiction over the state law claims pursuant to 28
`U.S.C. § 1332 based on the diversity of citizenship of the Plaintiffs and of Defendants, and the amount
`in controversy exceeds $75,000.
`4.
`Alternatively, this Court has subject-matter jurisdiction over the state law claims pursuant
`to the Class Action Fairness Act, 28 U.S.C. § 1332(d)(2). The amount-in-controversy, exclusive of costs
`and interests, exceeds the sum of $5,000,000, in the aggregate, there are well over 100 members of the
`proposed Class, and a Plaintiff and a Defendant are citizens of different states. Plaintiff Grace is a citizen
`of Pennsylvania and Defendants Google LLC and Google Payment are citizens of California, where they
`maintain their principal places of business.
`5.
`This Court has personal jurisdiction over the Defendants. Google LLC and Google
`Payment are headquartered in this District. All Defendants have engaged in sufficient minimum contacts
`with the United States and have purposefully availed themselves of the benefits and protections of United
`States and California law, such that the exercise of jurisdiction over them would comport with due
`process requirements.
`6.
`Venue is proper in this District pursuant to 28 U.S.C. § 1391(b) because Google LLC and
`Google Payment maintain their principal places of business in the State of California and in this District,
`because a substantial part of the events or omissions giving rise to Plaintiffs’ claims occurred in this
`District, and because, pursuant to 28 U.S.C. § 1391(c)(3), any Defendants not resident in the United
`States may be sued in any judicial district and their joinder with others shall be disregarded in determining
`proper venue. In the alternative, personal jurisdiction and venue also may be deemed proper under
`Section 12 of the Clayton Antitrust Act, 15 U.S.C. § 22, because Defendants may be found in or transact
`business in this District.
`III.
`INTRA-DISTRICT ASSIGNMENT
`7.
`Pursuant to N.D. Cal. Civil Local Rule 3.2 and General Order 44, this antitrust class action
`shall not be assigned to a particular Division of this District but shall be assigned on a District-wide basis.
`
`
`
`2
`CLASS ACTION COMPLAINT
`
`1
`2
`3
`4
`5
`6
`7
`8
`9
`10
`11
`12
`13
`14
`15
`16
`17
`18
`19
`20
`21
`22
`23
`24
`25
`26
`27
`28
`
`
`

`

`Case 5:20-cv-07079 Document 1 Filed 10/09/20 Page 5 of 57
`
`
`
`
`
`1
`2
`3
`4
`5
`6
`7
`8
`9
`10
`11
`12
`13
`14
`15
`16
`17
`18
`19
`20
`21
`22
`23
`24
`25
`26
`27
`28
`
`
`IV.
`
`PARTIES
`8.
`Plaintiff Dianne Bentley is an individual residing in North Carolina who purchased an
`application(s) and/or made an in-app purchase(s) through the Google Play Store during the relevant
`statutory period.
`9.
`Plaintiff Jennifer Grace is an individual residing in Pennsylvania who purchased an
`application(s) and/or made an in-app purchase(s) through the Google Play Store during the relevant
`statutory period.
`10.
`Plaintiff Adan Moya is an individual residing in Colorado who purchased an
`application(s) and/or made an in-app purchase(s) through the Google Play Store during the relevant
`statutory period.
`11.
`Plaintiff Coresa Trimble is an individual residing in Missouri who purchased an
`application(s) and/or made an in-app purchase(s) through the Google Play Store during the relevant
`statutory period.
`12.
`Plaintiff Robert Wing is an individual residing in Florida who purchased an application(s)
`and/or made an in-app purchase(s) through the Google Play Store during the relevant statutory period.
`13.
`Defendant Google LLC is a Delaware limited liability company with its principal place
`of business in Mountain View, California. Google LLC is the primary operating subsidiary of the publicly
`traded holding company Alphabet Inc. The sole member of Google LLC is XXVI Holdings, Inc., a
`Delaware corporation with its principal place of business in Mountain View, California. Google LLC
`contracts with all app developers that distribute their apps through the Google Play Store and is therefore
`a party to the anticompetitive contractual restrictions at issue in this suit.
`14.
`Defendant Google Ireland Limited (“Google Ireland”) is a limited company organized
`under the laws of Ireland with its principal place of business in Dublin, Ireland, and is a subsidiary of
`Google LLC. Google Ireland contracts with all app developers that distribute their apps through the
`Google Play Store and is therefore a party to the anticompetitive contractual restrictions at issue in this
`suit.
`
`
`
`3
`CLASS ACTION COMPLAINT
`
`

`

`Case 5:20-cv-07079 Document 1 Filed 10/09/20 Page 6 of 57
`
`
`
`
`15.
` Defendant Google Commerce Limited (“Google Commerce”) is a limited company
`organized under the laws of Ireland with its principal place of business in Dublin, Ireland, and is a
`subsidiary of Google LLC. Google Commerce contracts with all app developers that distribute their apps
`through the Google Play Store and is therefore a party to the anticompetitive contractual restrictions at
`issue in this suit.
`16.
`Defendant Google Asia Pacific Pte. Limited (“Google Asia Pacific”) is a private limited
`company organized under the laws of Singapore with its principal place of business in Mapletree
`Business City, Singapore, and is a subsidiary of Google LLC. Google Asia Pacific contracts with all app
`developers that distribute their apps through the Google Play Store and is therefore a party to the
`anticompetitive contractual restrictions at issue in this suit.
`17.
`Defendant Google Payment Corp. (“Google Payment”) is a Delaware corporation with its
`principal place of business in Mountain View, California, and is a subsidiary of Google LLC. Google
`Payment provides in-app payment processing services to Android app developers and Android users and
`collects a 30% commission on many types of processed payments, including payments for apps sold
`through the Google Play Store and in-app purchases made within such apps.
`V.
`RELEVANT FACTUAL ALLEGATIONS
`
`A.
`
`Google’s Domination Of The Market For Licensable Smart Mobile Operating
`Systems
`
`18.
`Google’s monopolization of the markets at issue in this case, the Android App Store
`Market and the Android In-App Payment Processing Market, as described in Sections V(B) and (C), are
`better understood through a discussion of smart mobile devices and Google’s domination and control of
`the Android operating system of the related market for licensable smart mobile operating systems
`(“OSs”).
`19.
`Smart mobile devices, including smartphones and tablets, are handheld, portable
`electronic devices that enable the user to connect wirelessly to the Internet and perform multi-purpose
`computing functions, including, but not limited to, internet browsing, shopping, accessing social media,
`
`
`
`4
`CLASS ACTION COMPLAINT
`
`1
`2
`3
`4
`5
`6
`7
`8
`9
`10
`11
`12
`13
`14
`15
`16
`17
`18
`19
`20
`21
`22
`23
`24
`25
`26
`27
`28
`
`
`

`

`Case 5:20-cv-07079 Document 1 Filed 10/09/20 Page 7 of 57
`
`
`
`
`streaming videos and music, and playing games. Many consumers now rely solely on their smart mobile
`device and have no other personal computer system.
`20. Mobile devices require an operating system (“OS”) to provide basic multi-purpose
`computing functionality, including the installation and operation of compatible mobile apps; button,
`touch, and motion commands; and a graphical user interface consisting of icons. A mobile operating
`system (“mobile OS”) is an OS that is built exclusively for a mobile device, such as a smart phone or
`tablet.
`
`21.
` Companies that design and sell smart mobile devices are referred to as original equipment
`manufacturers (“OEMs”). Android is the only commercially viable OS that is widely available to license;
`thus, OEMs have a single mobile OS option: Google’s Android OS. Accordingly, Google has monopoly
`power over the market for mobile OSs that are available for license by OEMs.
`22.
`Prior to sale, an OEM must pre-install an OS on each mobile device in order to provide
`purchasers with access to basic functions, including those described above. OEMs design mobile devices
`to ensure compatibility with whatever OS is selected for that device. Implementation of a mobile OS
`requires significant time and investment from OEMs, and switching to another mobile OS, as discussed
`in Section V(B)(2), is disruptive, expensive, and time-consuming.
`23.
`The vast majority of OEMs do not develop their own OS, so they must choose and license
`an OS for their devices. There is therefore a relevant market for licensable smart mobile OSs consisting
`of mobile OSs that OEMs can license for their smart mobile devices. The market does not include: (1)
`proprietary OSs that are unavailable for licensing, such as Apple’s mobile OS, called iOS which is used
`on Apple’s iPhone and iPad products; (2) mobile devices that lack the multi-computing functions of smart
`mobile devices and tablets (e.g., “flip phones”); or (3) electronic devices whose OS are not compatible
`with mobile device OS (e.g., desktop computers or gaming systems like Xbox). Historically, the market
`for smart mobile OSs included the Android OS, developed by Google, the Tizen mobile OS, a partially
`open-source mobile OS that was developed by the Linux Foundation and Samsung, and the Windows
`Phone OS developed by Microsoft.
`
`
`
`5
`CLASS ACTION COMPLAINT
`
`1
`2
`3
`4
`5
`6
`7
`8
`9
`10
`11
`12
`13
`14
`15
`16
`17
`18
`19
`20
`21
`22
`23
`24
`25
`26
`27
`28
`
`
`

`

`Case 5:20-cv-07079 Document 1 Filed 10/09/20 Page 8 of 57
`
`
`
`
`24.
`The geographic scope of the market for licensable smart mobile OSs is worldwide,
`excluding China. Google’s operations in China are limited for legal and regulatory reasons, Google does
`not make available many of its products for mobile devices sold within China, and non-Google, Android
`devices are widely available and popular there. Lastly, while Google contractually requires OEMs
`licensing Android not to sell devices with competing Android-compatible mobile OSs outside of China,
`it does not impose such restrictions on devices sold within China. Outside of China, OEMs must all
`contractually consent that if their device licenses the Android OS, they will not sell devices preloaded
`with a competing, Android-compatible mobile OS.
`25.
`The geographic scope of the market for licensable smart mobile operating systems
`includes a separate sub-market within the United States which operates as described throughout this
`Complaint.
`26.
`Google possesses monopoly power in the market for licensable smart mobile OSs through
`its Android OS.
`27.
`A mobile ecosystem of products like apps, devices, and accessories typically develops
`around one or more mobile OSs, such as the Android OS. The “Android ecosystem” is a system of mobile
`products that are inter-dependent and compatible with each other and the Android OS. Ecosystem
`participants include Google, OEMs of Android-compatible devices, developers of Android-compatible
`apps, Android app distribution platforms, the makers of ancillary hardware such as headphones or
`speakers, cellular carriers, and others.2 The Android ecosystem is akin to the iOS ecosystem created by
`Apple, “[w]hen you combine all of Google’s services with Google’s hardware and its frequently updated
`software, recreating the same type of ecosystem that Apple claims is only possible with Apple, is, indeed,
`possible outside of Apple . . . . Google’s ecosystem is a capable one.”3
`
`
`2 Jason Cipriani, Is there an alternative to Apple’s ecosystem? Yes, but you’ll have to Google it, ZD
`NET (May 1, 2019), https://www.zdnet.com/article/alternatives-to-apples-ecosystem-yes-there-is-a-
`way-out/.
`3 Id.
`
`
`
`6
`CLASS ACTION COMPLAINT
`
`1
`2
`3
`4
`5
`6
`7
`8
`9
`10
`11
`12
`13
`14
`15
`16
`17
`18
`19
`20
`21
`22
`23
`24
`25
`26
`27
`28
`
`
`

`

`Case 5:20-cv-07079 Document 1 Filed 10/09/20 Page 9 of 57
`
`
`
`
`28.
`As more developers design useful, compatible apps for a specific mobile OS, the more
`consumers will want to use that OS. The more consumers using an OS, the more developers want to
`develop apps for it. Thus, significant barriers to entry arise for new entrants to the OS market. A new OS
`appeals to consumers only if there is a broad array of software applications running on it, and software
`developers are not incentivized to create applications for an OS unless there is a large existing user base.
`29.
`In order to attract app developers and users, Google misleadingly represents that Android
`is an “open” ecosystem where any participant may create Android-compatible products without
`unnecessary restrictions. Instead, however, Google uses its Android OS to keep its ecosystem closed to
`any competition. As the dominant OS licensor, Google recognizes that participation on its platform is a
`“must-have” market for developers. Google only unlocks the door to its ecosystem for participants
`willing to play by Google’s rules.
`30. Moreover, Google uses the Android OS to restrict which apps and app stores OEMs pre-
`install on their devices and to deter the direct distribution of competing app stores and apps to Android
`users, all at the expense of competition in the Android ecosystem.
`31.
`As a result of Google’s monopoly power in the market for licensable smart mobile OSs,
`OEMs, developers and users cannot choose another mobile OS. OEMs such as ZTE and Nokia
`acknowledge that other, non-proprietary OSs are inadequate substitutes for and not a reasonable
`alternative to licensing the Android OS.4 Other mobile OSs do not currently support many popular mobile
`apps that are valued by consumers. Google, therefore, has constructed a market that biases consumers
`against mobile device purchases from non-proprietary mobile OS other than Android OS. OEMs are
`forced to concede to Google’s demands because it is essential that they offer a popular mobile OS and
`corresponding ecosystem to consumers.
`
`
`4 Google Android, No. AT.40099, European Commission Decision (July 18, 2018) (“EC Google
`Android Decision”) at ¶ 292,
`https://ec.europa.eu/competition/antitrust/cases/dec_docs/40099/40099_9993_3.pdf.
`
`
`
`7
`CLASS ACTION COMPLAINT
`
`1
`2
`3
`4
`5
`6
`7
`8
`9
`10
`11
`12
`13
`14
`15
`16
`17
`18
`19
`20
`21
`22
`23
`24
`25
`26
`27
`28
`
`
`

`

`Case 5:20-cv-07079 Document 1 Filed 10/09/20 Page 10 of 57
`
`
`
`
`
`1
`2
`3
`4
`5
`6
`7
`8
`9
`10
`11
`12
`13
`14
`15
`16
`17
`18
`19
`20
`21
`22
`23
`24
`25
`26
`27
`28
`
`
`B.
`Google Unlawfully Maintains A Monopoly In The Android App Store Market
`32.
`A pre-installed app store is a necessity for mobile device users. An app store is an online
`portal through which software programs are made available for procurement and download. Mobile apps
`make mobile devices valuable to users because they add user-specific functionality for activities such as
`banking, shopping, making travel arrangements, streaming music and videos, reading news sources and
`books, and game playing.
`33. While some apps are pre-installed by OEMs, due to each consumer’s specific preferences,
`OEMs cannot anticipate the various apps a specific consumer may utilize. Furthermore, apps developed
`after a user purchases his or her mobile device cannot, as a practical matter, be pre-installed. Thus, mobile
`devices must provide a way for users to download and/or buy apps post-purchase.
`1.
`Android App Stores Constitute a Relevant Product Market
`34.
`The market for Android App Stores constitutes a relevant product market. On Android
`mobile devices, Google maintains its heavily dominant Google Play Store, a pre-loaded digital portal set
`up by Google. On the Google Play Store, mobile apps can be reviewed, purchased (if necessary), and
`downloaded by a consumer.
`35.
`The European Commission has determined there is a “relevant product market” for
`Android app stores. Google did not contest that determination.5
`36.
`Google has offered an app store for Google Android since 2008. An early version of
`Google’s app store was known as “Android Market”, which in March 2012, was integrated into Google
`Play and became the Google Play Store.
`37.
`The Play Store is part of Google Mobile Services, the bundle of Google apps and services
`Google licenses together.
`
`
`5 EC Google Android Decision at ¶¶ 217(2), 273. “From a supply-side perspective, the development of
`an app store requires significant time and resources, regardless of whether the developer in question has
`already developed other apps. In particular, developers of other apps have stated that the time and
`resources to develop an app store are significant. Microsoft, for example, stated: ‘Using [R&D data] for
`fiscal years 2007 to 2014, we roughly estimate that we spent [millions of dollars] over this time period
`to develop appstores for Windows Phone 7, 8, and 8.1.’” Id. at ¶ 272 (emphasis omitted).
`
`
`
`8
`CLASS ACTION COMPLAINT
`
`

`

`Case 5:20-cv-07079 Document 1 Filed 10/09/20 Page 11 of 57
`
`
`
`
`38.
`Unlike other Google apps, the Play Store is not downloadable and therefore needs to be
`pre-installed by OEMs so that users have access to it. App developers cannot distribute alternative apps
`via the Play Store.
`39.
`In order to download an app (which is either free or available for purchase), an Android
`user must download that application through the Google Play Store. As described by Google, “With some
`apps, you can buy additional content or services within the app. We call these ‘in-app purchases.’ ….
`[S]ome examples of in-app purchases [include]:
`• A sword that gives you more power in a game.
`• A key that unlocks more features of a free app.
`• Virtual currency that can be used for purchases.”6
`40.
`The Android App Store Market also includes other app stores for Android devices, such
`as Samsung’s Galaxy Apps store and the Amazon AppStore, and independent app stores, such as GetJar.
`41.
`The Android App Store Market does not include app stores for non-Android smart mobile
`OSs, such as the (now defunct) Windows Mobile Store (which is compatible only with Microsoft’s
`Windows Mobile OS) or Apple’s App Store (compatible only with iOS), because app stores are OS-
`specific. A consumer who owns an Android smartphone cannot use an app store developed for a non-
`Android OS, and an OEM that pre-installs an app store on an Android device cannot install an app store
`that runs on a non-Android OS. The Google Play Store does not offer apps for download onto Apple
`devices, and the Apple Store does not offer apps for download onto Android devices.
`
`
`6Google Play Help, Make in-app purchases in Android apps, GOOGLE,
`https://support.google.com/googleplay/answer/1061913?hl=en (last visited Oct. 2, 2020). Examples of
`“products supported by Google Play In-app billing include: Virtual game products . . . . App
`functionality or content . . . . subscription services . . . . [and] Cloud software products.” Examples of
`“products not currently supported by Google Play In-app billing [include]: [r]etail merchandise . . . .
`Service fees . . . . One-time membership fees or recurring dues . . . . One-time payments, including
`peer-to-peer payments . . . . [and] Electronic bill payment . . . .” Classic Play Console Help, Payments,
`GOOGLE, https://support.google.com/googleplay/android-developer/answer/9858738?hl=en. (last
`visited Oct. 6, 2020).
`
`
`
`9
`CLASS ACTION COMPLAINT
`
`1
`2
`3
`4
`5
`6
`7
`8
`9
`10
`11
`12
`13
`14
`15
`16
`17
`18
`19
`20
`21
`22
`23
`24
`25
`26
`27
`28
`
`
`

`

`Case 5:20-cv-07079 Document 1 Filed 10/09/20 Page 12 of 57
`
`
`
`
`42.
`The relevant geographic market for the Android App Store Market is worldwide,
`excluding China.7 China is excluded from the relevant market because legal and regulatory barriers
`prevent the operation of many global app stores, including the Google Play Store, within China.
`Additionally, app stores prevalent in China are not available, or have little presence, outside of China.
`Outside of China, app distribution channels like app stores, are globally developed and distributed, and
`OEMs, in turn, make app stores like the Google Play Store globally available on Android devices.
`43.
`The geographic scope of the Android App Store Market includes a separate sub-market
`within the United States which operates as described throughout this Complaint.
`2.
`Google Monopolizes the Android App Stores Market
`44.
`Through various anticompetitive acts and unlawful restraints on competition, Google
`possesses and maintains monopoly power in the Android App Stores Market, causing ongoing harm to
`competition and injury to consumers. Google’s monopoly power is evidenced by its market share, the
`absence of countervailing buyer power, and the existence of high barriers to entry and expansion. Apple’s
`App Store (which is not part of the relevant product market), does not exercise an indirect restraint
`sufficient to undermine Google’s monopoly power.
`45.
`In the Google Android case, the European Commission concluded that Google holds a
`dominant position in the worldwide market (excluding China) for Android App Stores since 2011.8
`46.
`The existence of iPhone mobile devices applications and in-app products and services are
`not reasonably interchangeable substitutes for Android apps.
`47.
`In a July 18, 2018 decision, the European Commission concluded that Google abused its
`dominant power in the Android App Store Market. The European Commission fined Google €4.34 billion
`for breaching EU antitrust rules, concluding that, since 2011, Google has imposed illegal restrictions on
`Android device manufacturers and mobile network operators to cement its dominant position in general
`
`
`7 See EC Google Android Decision at ¶ 402: “The Commission concludes that the [Android App Stores
`Market] for the purpose of these proceedings are: . . . the worldwide market (excluding China) for
`Android app stores”.
`8 Id. at ¶ 439(2).
`
`
`
`10
`CLASS ACTION COMPLAINT
`
`1
`2
`3
`4
`5
`6
`7
`8
`9
`10
`11
`12
`13
`14
`15
`16
`17
`18
`19
`20
`21
`22
`23
`24
`25
`26
`27
`28
`
`
`

`

`Case 5:20-cv-07079 Document 1 Filed 10/09/20 Page 13 of 57
`
`
`
`
`internet searches. The European Commission determined that, “Google is dominant in the worldwide
`market (excluding China) for app stores for the Android mobile operating system. Google’s app store,
`the Play Store, accounts for more than 90% of apps downloaded on Android devices. This market is also
`characterized by high barriers to entry . . . . Google’s app store dominance is not constrained by Apple's
`App Store, which is only available on iOS devices.”9
`48.
`As determined by the Majority Staff of the Subcommittee on Antitrust, Commercial and
`Administrative Law of the House Committee on the Judiciary: “Apps are not interoperable between
`operating systems – native apps developed for [Apple’s] iOS only work on iOS devices, and native apps
`developed for Android only work on Android devices. The [Apple] App Store and the Play Store do not
`compete against one another. Android users cannot access the Apple App Store and iOS users cannot
`access the Google Play Store, so the dominance of the Play Store is not constrained by the App Store and
`vice versa.” ”10 Additionally, “app developers and industry observers agree that Apple and Google
`control the app distribution market on mobile devices.”11
`49.
`In the United States, iOS and Android represent approximately 99% of the market share
`for mobile OS as of September 2020.12 Because iOS is not licensable, it is not part of the market that is
`in consideration with respect to this case, which is the market for licensable OS for mobile devices. With
`respect to the OS which are licensable, including Samsung and Windows, neither of them has been able
`to penetrate the market share held by Google’s Android OS.13
`
`
`9 Press Release, Antitrust: Commission fines Google €4.34 billion for illegal practices regarding
`Android mobile devices to strengthen dominance of Google’s search engine, EUROPEAN COMMISSION
`(July 18, 2018), https://ec.europa.eu/commission/presscorner/detail/en/IP_18_4581.
`10 Investigation of Competition in Digital Markets, Majority Staff Report and Recommendations,
`Subcommittee on Antitrust, Commercial and Administrative Law of the House Committee on the
`Judiciary, at 95 (Oct. 6, 2020), available at
`https://judiciary.house.gov/uploadedfiles/competition_in_digital_markets.pdf.
`11 Id. at 96.
`12 Mobile Operating System Market Share United States of America, STATCOUNTER GLOBALSTATS,
`(Sept. 2020) https://gs.statcounter.com/os-market-share/mobile/united-states-of-america/#monthly-
`202009-202009-bar.
`13 Id.
`
`
`
`11
`CLASS ACTION COMPLAINT
`
`1
`2
`3
`4
`5
`6
`7
`8
`9
`10
`11
`12
`13
`14
`15
`16
`17
`18
`19
`20
`21
`22
`23
`24
`25
`26
`27
`28
`
`
`

`

`Case 5:20-cv-07079 Document 1 Filed 10/09/20 Page 14 of 57
`
`
`
`
`50.
`Currently, Google’s dominance of the Android App Stores market exceeds 90%. The
`European Commission found that the Google Play Store is pre-installed on 90% of Android devices sold
`outside of China.14 Additionally, the number of apps downloadable from the various app stores shows
`the disparity caused by Google’s monopolistic grip: in 2019, Google Play had 2.7 million available apps
`for download, whereas the next four closest competitors number of apps do not even add up to the total
`the amount of available apps on Google Play (GetJar has 850,000 apps, Aptoide has 1,000,