Case 5:20-cv-07365 Document 1 Filed 10/20/20 Page 1 of 19
`
`KAPLAN FOX & KILSHEIMER LLP
`Laurence D. King (SBN 206423)
`Mario M. Choi (SBN 243409)
`1999 Harrison Street, Suite 1560
`Oakland, CA 94612
`Tel.: (415) 772-4700
`Fax: (415) 772-4707
`lking@kaplanfox.com
`mchoi@kaplanfox.com
`
`KAPLAN FOX & KILSHEIMER LLP
`Robert N. Kaplan (pro hac vice to be sought)
`Hae Sung Nam (pro hac vice to be sought)
`Frederic S. Fox (pro hac vice to be sought)
`Donald R. Hall (pro hac vice to be sought)
`Aaron L. Schwartz (pro hac vice to be sought)
`850 Third Avenue
`New York, NY 10022
`Tel.: (212) 687-1980
`Fax: (212) 687-7715
`rkaplan@kaplanfox.com
`hnam@kaplanfox.com
`ffox@kaplanfox.com
`dhall@kaplanfox.com
`aschwartz@kaplanfox.com
`
`Attorneys for Plaintiff 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
`
`
`
`Case No. 5:20-cv-07365
`CLASS ACTION COMPLAINT
`
`
`DEMAND FOR JURY TRIAL
`
`KONDOMAR HERRERA, on behalf of
`herself and all others similarly situated,
`
`Plaintiff,
`
`v.
`
`
`GOOGLE LLC, a Delaware limited
`liability company,
`
`
`
`
`Defendant.
`
`
`
`
`
`
`
`
`
`CLASS ACTION COMPLAINT
`
`Case No. 5:20-cv-07365
`
`

`

`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-07365 Document 1 Filed 10/20/20 Page 2 of 19
`
`
`
`TABLE OF CONTENTS
`
` INTRODUCTION ............................................................................................................................ 1
`JURISDICTION AND VENUE ....................................................................................................... 2
`INTRADISTRICT ASSIGNMENT .................................................................................................. 2
`PARTIES .......................................................................................................................................... 2
`FACTUAL ALLEGATIONS ........................................................................................................... 3
`GOOGLE MAINTAINS AN UNLAWFUL MONOPOLY IN THE ANDROID MOBILE APP
`DISTRIBUTION MARKET ............................................................................................................. 3
`I.
`The Android Mobile App Distribution Market is a Relevant Product Market ......... 3
`II.
`The United States is the Relevant Geographic Market ............................................. 4
`III.
`Google has Monopoly Power in the Android Mobile App Distribution Market ...... 5
`IV.
`Google has Engaged in Anticompetitive Conduct in the Android Mobile App
`Distribution Market Resulting in Anticompetitive Effects. ...................................... 8
`A.
`Google’s Anticompetitive Restraints on OEMs ............................................ 8
`B.
`Google has Imposed Anticompetitive Restraints on Mobile-App
`Developers .................................................................................................... 9
`ANTITRUST INJURY ................................................................................................................... 10
`CLASS ACTION ALLEGATIONS ............................................................................................... 11
`CLAIMS .......................................................................................................................................... 12
`Count 1: Unlawful Monopoly of the Android Mobile App Distribution Market in
`Violation of Sherman Act § 2 ...................................................................................... 12 
`Count 2: Unlawful Restraints of Trade Concerning the Android Mobile App
`Distribution Market in Violation of Sherman Act § 1 ................................................. 14 
`Count 3: Unreasonable Restraint of Trade in the Android Mobile App Distribution
`Market in Violation of the California Cartwright Act ................................................. 15 
`PRAYER FOR RELIEF .................................................................................................................. 16 
`JURY TRIAL DEMAND ............................................................................................................... 17 
`
`
`
`
`
`
`
`
`
`
`- i -
`CLASS ACTION COMPLAINT
`
`Case No. 5:20-cv-07365
`
`

`

`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-07365 Document 1 Filed 10/20/20 Page 3 of 19
`
`
`
`Plaintiff Kondomar Herrera (“Plaintiff”), on behalf of herself and all others similarly
`situated, brings this Class Action Complaint for damages and injunctive relief against defendant
`Google LLC (“Google”) for violations of Sections 1 and 2 of the Sherman Act, 15 U.S.C. §§ 1 and
`2, and for violations of California’s Cartwright Act, Cal. Bus. & Prof. Code § 16700, et. seq. All
`allegations other than those concerning the Plaintiff, are based on information and belief.
`
`INTRODUCTION
`1.
`In the United States, nearly 90 percent of a user’s on-screen time on a mobile device
`is spent on a mobile app. Mobile apps are most often downloaded from an app store, which
`centralizes and curates the distribution of mobile apps in a convenient, user-friendly manner.
`2.
`Google owns and operates the largest app store on earth, the Google Play Store. The
`Google Play Store is available to all mobile device users running Google’s Android operating
`system (“OS”). The Google Play Store offers users the choice of more than 2.96 million apps, and,
`in 2019, users worldwide downloaded those apps more than 84.3 billion times.
`3.
`To build this prodigious marketplace, Google represented that the Android OS
`would be maintained as “open” source software whereby anyone could create Android-compatible
`products without undue restrictions. But, as the app store grew and as Google’s Android OS became
`the “must-have” operating software for mobile device original-equipment manufacturers
`(“OEMs”), Google began to close its ecosystem through a series of restrictive agreements that were
`designed to (and did in fact) deter and eliminate competition in the market for Android mobile apps
`and in-app products, (“the Android Mobile App Distribution Market”).
`4.
`Google’s anticompetitive conduct, described below, allowed it to extract
`supracompetitive profits from consumers—like Plaintiff and Class Members—who paid Google
`directly for mobile apps purchased through the Google Play Store. Indeed, the Google Play Store
`contains more than 90 percent of Android mobile app downloads worldwide, which, through the
`30 percent price Google extracts from Plaintiff and Class Members’ mobile app and in-app
`purchases, helped Google to generate more than $21.5 billion in ill-gotten revenue.
`
`
`
`
`
`
`- 1 -
`CLASS ACTION COMPLAINT
`
`Case No. 5:20-cv-07365
`
`

`

`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-07365 Document 1 Filed 10/20/20 Page 4 of 19
`
`
`
`5.
`Plaintiff and Class Members have also been harmed by Google’s anticompetitive
`scheme because: (1) developers set higher app prices due to the high costs imposed on developers
`by Google; and (2) app quality has been reduced as app developers generated lower returns.
`6.
`Plaintiff, on behalf of herself and the Class, seeks to recover the damages caused by
`Google’s unlawful anticompetitive conduct and to obtain an order enjoining Google from
`continuing to engage in these unlawful practices.
`
`JURISDICTION AND VENUE
`7.
`This Court has personal jurisdiction over defendant Google because it is
`headquartered in this district and because it has sufficient minimum contacts with the United States
`to have purposefully availed itself of the benefits and protections of the United States and California
`law such that the exercise of jurisdiction over it would comport with due process requirements.
`8.
`This Court has subject-matter jurisdiction over Plaintiff’s federal antitrust claims
`pursuant to the Clayton Act § 16, 15 U.S.C. § 26, and 28 U.S.C. §§ 1331 and 1337.
`9.
`The Court has supplemental jurisdiction over Plaintiff’s state law claims pursuant
`to 28 U.S.C. § 1367.
`10.
`Venue is proper in this district pursuant to 28 U.S.C. § 1391(b) because: (1) Google
`maintains its principal places of business in the State of California and in this district; and (2) a
`substantial part of the events or omissions giving rise to Plaintiff’s claims occurred in this district.
`11.
`In the alternative, personal jurisdiction and venue are proper under Clayton Act § 12,
`15 U.S.C. § 22, because defendant is found in and transacts business in this district.
`INTRADISTRICT ASSIGNMENT
`12.
`Assignment of this case to the San Jose Division is proper pursuant to Civil Local
`Rule 3-2(c)(e) because a substantial part of the events or omissions giving rise to Plaintiff’s claims
`occurred in Santa Clara County, California.
`PARTIES
`13.
`Plaintiff Kondomar Herrera is a natural person who resides in Queens County, New
`York. Plaintiff purchased and paid Google for one or more apps through the Google Play Store and
`
`
`
`
`
`
`- 2 -
`CLASS ACTION COMPLAINT
`
`Case No. 5:20-cv-07365
`
`

`

`Case 5:20-cv-07365 Document 1 Filed 10/20/20 Page 5 of 19
`
`
`
`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
`
`purchased and paid Google directly for in-app digital content through an app purchased on the
`Google Play Store within the last four years.
`14.
`Google LLC is a Delaware limited liability company with its principal place of
`business at 1600 Amphitheatre Way, Mountain View, California. Google LLC is a technology
`company that provides internet-related services and products. Since 2005, Google has owned and
`developed the Android OS for use in Android licensed mobile devices. Google LLC is also the
`owner of the Google Play Store from and by which developers of Android mobile apps sell their
`mobile app and in-app products to Android-operated mobile device owners.
`FACTUAL ALLEGATIONS
`GOOGLE MAINTAINS AN UNLAWFUL MONOPOLY IN THE ANDROID MOBILE
`APP DISTRIBUTION MARKET
`
`I.
`
`The Android Mobile App Distribution Market is a Relevant Product Market
`15.
`A mobile app is a standardized piece of software that is optimized for use on a
`mobile device and provides access to digital content or services or otherwise allows users to share
`content, play games, or make transactions for physical or digital goods and services (an “in-app
`purchase”).
`16. While mobile apps may be pre-installed on a mobile device as a component of the
`OS by the OEM, or otherwise loaded directly onto the mobile device from the web using a web
`browser (a process that Google refers to as “sideloading”), the predominant way—by far—that
`consumers access mobile apps is through an app store, which itself may be pre-installed on the
`mobile device.
`17.
`The app store is widely recognized as the starting point for accessing mobile apps,
`making it critical to the user experience, because it centralizes and curates the distribution of mobile
`apps in a convenient manner. Through an app store, a user may search, browse, find, review, buy,
`compare, and remove a mobile app. The app store may also offer mobile app developers’ tools and
`services that support the building of mobile apps for that app store.
`18.
`The rules governing an app store are typically set forth by the app store proprietor—
`here, Google—and concern things like: the types of mobile apps permitted in the app store; absence
`
`
`
`
`
`
`- 3 -
`CLASS ACTION COMPLAINT
`
`Case No. 5:20-cv-07365
`
`

`

`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-07365 Document 1 Filed 10/20/20 Page 6 of 19
`
`
`
`of malware; how users pay for mobile apps; how revenue is distributed between the mobile app
`developer and the app store; and other such necessary details.
`19.
`Because mobile apps are built in a specific programming language and configured
`to run on a specific type of mobile device OS as “native apps,” distinct and separate product markets
`exist for mobile apps specific to the relevant OSs. For example, native apps developed for Apple
`iOS only work on Apple mobile devices and native apps developed for Android OS only work on
`Android mobile devices. Apple’s App Store and the Google Play Store therefore do not compete
`against one another because Android users cannot utilize iOS apps or the Apple App Store, and
`iOS users utilize Android apps or the Google Play Store. So, Google’s dominance of the Google
`Play Store is not constrained by Apple’s App Store and vice versa.
`20.
`Similarly, web sites and web apps are not competitively significant alternatives to
`the Android Mobile App Distribution Market. Mobile apps provide a deeper, richer user experience
`as compared to websites and web apps. For example, mobile apps can provide additional, unique
`functionalities by accessing specific features within the mobile device’s hardware and operating
`system, such as a camera or location services. Moreover, websites and web apps rely on an internet
`connection, whereas mobile apps may continue to function even when the mobile device loses
`internet access. Because of these intrinsic benefits, users overwhelmingly choose to access content
`and services on their mobile devices through mobile apps—including for basic communication,
`business transactions, entertainment, and news—even though mobile devices users could access
`that content on their mobile devices via the internet. Indeed, in the United States, nearly 90 percent
`of user screen time on mobile devices is spent on mobile apps.
`21.
`The Android Mobile App Distribution Market is therefore a relevant market that is
`comprised of all the channels by which mobile apps are distributed to Android OS users.
`II.
`The United States is the Relevant Geographic Market
`22.
`The relevant geographic market for the Android Mobile App Distribution Market is
`the United States. App stores (and other app distribution channels) are broadly developed and
`distributed throughout the United States, as are the mobile apps contained within the app stores.
`
`
`
`
`
`
`- 4 -
`CLASS ACTION COMPLAINT
`
`Case No. 5:20-cv-07365
`
`

`

`Case 5:20-cv-07365 Document 1 Filed 10/20/20 Page 7 of 19
`
`
`
`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
`
`Indeed, the Google Play Store—and the apps downloaded through it—are available to Android
`users anywhere in the United States.
`III. Google has Monopoly Power in the Android Mobile App Distribution Market
`23.
`The Google Play Store has more than 90 percent of all app store downloads in the
`Android Mobile App Distribution Market.
`24.
`Google has designed the Android ecosystem to ensure that other sources of mobile
`apps for the Android OS are less desirable or of inferior quality. There are only three ways by which
`an Android phone user may access rival mobile apps: an app store may be pre-installed on the
`mobile device; a mobile app may be downloaded from another app store; or a mobile app may be
`sideloaded onto the mobile device. Google has thwarted meaningful user access for each.
`25.
`First, Google has successfully demanded and reached agreements with mobile
`device OEMs that require the OEMs to pre-install and prominently display the Google Play Store
`on all mobile devices. Pre-installation is crucial because, as Google explains, “most users just use
`what comes on the device. People rarely change defaults.”
`26.
`Second, Google, as the proprietor of the Google Play Store, has exercised its
`monopoly power by refusing to allow any rival app stores to be accessed through the Google Play
`Store.
`
`27.
`Thus, the only practical way for users to access a third-party app store is through
`sideloading. While Google theoretically permits sideloading third-party app stores, few users
`pursue this option because Google has implemented significant frictions designed to steer
`consumers away from sideloading. Sideloading a mobile app store has required users to go through
`a complicated multi-step process whereby users encounter multiple, unfounded security warnings
`that suggest sideloading was unsafe.
`28.
`As explained by Epic, the maker of the popular mobile game Fortnight, in a recent
`lawsuit it filed against Google:
`
`Google ensures that the Android process is technically complex, confusing
`and threatening, filled with dire warnings that scare most consumers into
`abandoning the lengthy process. For example, depending on the version of
`Android running on a mobile device, downloading and installing Fortnite
`on an Android device could take as many as 16 steps or more, including
`
`- 5 -
`CLASS ACTION COMPLAINT
`
`Case No. 5:20-cv-07365
`
`
`
`
`
`
`

`

`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-07365 Document 1 Filed 10/20/20 Page 8 of 19
`
`
`
`requiring the user to make changes to the device’s default settings and
`manually granting various permissions while being warned that doing so is
`dangerous.
`
`29.
`And even where a rival app store is successfully sideloaded, Google attempts to
`thwart continued use of that app store by limiting some basic app functions that are available to
`apps downloaded on the Google Play Stare. For instance, apps downloaded through the Google
`Play Store are pre-set to automatically update in the mobile device’s background. Meanwhile, as
`explained by Amazon on its website, updating an app on its Android app store requires a user to
`follow a multi-step process: “1. Open the app store you used to install the app on your device.
`2. Search for the app and open the app’s detail page. 3. If an update is available, an Update option
`displays.” (emphasis in original). By making the app update process difficult, Google further
`discourages users from seeking out rival app stores and the apps offered therein.
`30.
`By impeding (or interfering with) user access to third-party app stores, Google has
`ensured that it can extract supracompetitive prices for its Android app distribution services and in-
`app purchases made through the Google Play Store. Google has charged a 30 percent commission
`on sales of paid apps and a 30 percent fee for in-app purchases. Google collects and processes these
`commissions and fees directly from Plaintiff and Class Members, remitting the remainder of their
`payment to the mobile app developer. These commissions and fees generated more than
`$21.5 billion in global revenue for Google in 2018. If Google had operated the Google Play Store
`in a competitive market, free of Google’s anticompetitive restraints, then the fees and commissions
`that Google could have collected from Plaintiff and Class Members would be significantly lower.
`Indeed, the commissions charged by alternative electronic payment processing tools—like PayPal
`and Square—are 2.9 percent and between 2.6 and 3.5 percent, respectively.
`31.
`Google has abused and maintained its monopoly power in the Android Mobile App
`Distribution Market through restrictive, non-negotiable agreements with mobile app developers—
`who must choose between complying with Google’s draconian terms of use or exit Google’s
`ecosystem. To have a mobile app listed on the Google Play Store, mobile app developers must
`agree and have agreed with Google to not license their mobile app to any rival app stores. Indeed,
`Google’s developer agreements mandate that developers may not “make available any Product that
`
`
`
`
`
`
`- 6 -
`CLASS ACTION COMPLAINT
`
`Case No. 5:20-cv-07365
`
`

`

`Case 5:20-cv-07365 Document 1 Filed 10/20/20 Page 9 of 19
`
`
`
`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
`
`has a purpose that facilitates the distribution of software applications and games for use on Android
`devices outside of Google Play.” This has enabled Google to secure the most desired and highest
`quality mobile apps while simultaneously foreclosing access to mobile apps by rival app stores.
`Mobile app developers must acquiesce to Google’s demand because leaving the Google Play Store
`to distribute software to Android users via sideloading or through third-party app stores causes
`precipitous declines in downloads and revenue.
`32. Most other mobile app stores that exist in the Google ecosystem therefore serve
`niche products (for example, Samsung’s Galaxy Store, which only offers apps related to Samsung-
`branded products) or otherwise must be sideloaded and have limited numbers of high-quality
`mobile apps. Aptoide, the second largest app store available to Android users only offers Plaintiff
`and Class Members approximately 700,000 apps, capturing only 1-2 percent of all Android mobile
`app downloads. Similarly, Amazon’s Android app store only offers Plaintiff and Class Members
`approximately 487,000 apps, capturing less than 1 percent of all Android mobile downloads.
`Meanwhile, the Google Play Store offers Plaintiff and Class Members 2.56 million apps, including
`all the mobile apps most sought after by users, thereby enabling it to capture more than 90 percent
`of all Android mobile app downloads.
`33.
`There are significant barriers to users switching mobile OSs. In 2018, Consumer
`Intelligence Research Partners reported that more than 90 percent of Android users who bought a
`new mobile device purchased a new Android mobile device.
`34.
`Part of a user’s lack of interest in switching is due to network effects. Google
`Android and Apple iOS have different operating concepts, user interface designs, and setting and
`configuration options. Users tend to pick one, learn it, invest in mobile apps and storage, and stick
`with it. Switching operating systems may entail the loss of compatibility with other smart devices
`designed to work in conjunction with the mobile device and its OS and the hassle of porting data
`from one OS to another. While mobile devices have a limited lifespan, and users might be expected
`to “break the lock-in cycle” when it is time to upgrade to a new device, users’ reliance on software,
`data, and files, and other hardware and accessories that are only compatible with one product
`ecosystem, make it unlikely that they would switch to a non-compatible mobile device.
`
`
`
`
`
`
`- 7 -
`CLASS ACTION COMPLAINT
`
`Case No. 5:20-cv-07365
`
`

`

`Case 5:20-cv-07365 Document 1 Filed 10/20/20 Page 10 of 19
`
`
`
`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
`
`35.
`Based on the foregoing, there is abundant evidence that Google has monopoly power
`in the Android Mobile App Distribution Market.
`
`IV. Google has Engaged in Anticompetitive Conduct in the Android Mobile App
`Distribution Market Resulting in Anticompetitive Effects.
`
`36.
`Google has implemented a multi-prong anticompetitive scheme to establish and
`maintain its monopoly in the Android Mobile App Distribution Market and foreclose rival app store
`distribution channels. As a direct result of Google’s anticompetitive scheme, it has charged
`supracompetitive prices for mobile app and in-app purchases.
`A.
` Google’s Anticompetitive Restraints on OEMs
`37.
`Google has imposed and OEMs have agreed to anticompetitive covenants in
`Google’s Mobile Application Distribution Agreement (“MADA”). This agreement, among other
`things, has required OEMs to:
` License the entire suite of Google applications and services (such as Google Play
`Services, Google Chrome, Gmail, Google Search, Google Maps, and YouTube)
`to license the Android OS;
` Pre-install the Google Play Store, as well as up to 30 other proprietary Google
`apps; and
` Place the Google Play Store on or near the main “home screen page” in its
`default configuration.
`38.
`OEMs must agree and have agreed to Google’s anticompetitive, restrictive terms
`and conditions or risk losing access to the Android OS. For example, in 2012 Acer partnered with
`Alibaba to release products on Alibaba’s OS, Aliyun. When Google learned of this, it threatened to
`terminate its partnership with Acer. Acer subsequently abandoned its deal with Alibaba.
`39.
`The restrictive MADA terms and conditions substantially limit the ability of rival
`app stores to meaningfully compete against Google in the Android Mobile App Distribution
`Market. By requiring pre-installation and prominent display of the Google Play Store, Google
`ensures that competing app stores are at a significant disadvantage the moment the user takes a
`mobile device out of the box. Google has acknowledged the competitive significance of pre-
`
`
`
`
`
`
`- 8 -
`CLASS ACTION COMPLAINT
`
`Case No. 5:20-cv-07365
`
`

`

`Case 5:20-cv-07365 Document 1 Filed 10/20/20 Page 11 of 19
`
`
`
`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
`
`installation, noting that “[p]reloading remains valuable to users, and hence device manufacturers,
`despite full unbundling because most users just use what comes on the device. People rarely change
`defaults.”
`40.
`For example, Epic, which makes the popular game Fortnight, tried to partner with
`LG, an Android-licensed OEM, to ease the restrictions by which users could download and play its
`game. But LG ultimately refused, informing Epic that its contract with Google required LG “to
`block side downloading off Google Play Store this year.” (emphasis added).
`41.
`Google’s restrictive MADA agreements have therefore foreclosed meaningful
`competition in the Android Mobile App Distribution Market, allowing Google to charge
`supracompetitive prices for mobile app and in-app purchases. The anticompetitive MADA
`agreements have also harmed Plaintiff and Class Members by limiting consumer choice. Absent
`Google’s unlawful restraints of trade, OEMs would be free to negotiate with third-party app stores
`for prominent placement on the OEMs’ mobile device home screens. Third-party app stores could
`then attract prominent app developers to their store. Plaintiff and Class Members would benefit
`from such competition through added choices and lowered costs for mobile apps and in-app
`purchases.
`B.
`Google has Imposed Anticompetitive Restraints on Mobile-App Developers
`42.
`Through its Google Play Developer Distribution Agreement (“DDA”), Google has
`imposed anticompetitive contractual restrictions on app developers to foreclose meaningful
`competition in the Android Mobile App Distribution Market, thereby ensuring rival app stores lack
`access to high-quality, in-demand mobile apps. Indeed, Google has refused to negotiate any
`provision of the DDA and has required all mobile-app developers to sign the DDA before Google
`will list their mobile app on the Google Play Store.
`43.
`The restrictive provisions in the DDA include:
` Section 4.1, which has mandated compliance with Google’s Developer Program
`Policies. These Policies have required, among other things, that mobile device
`app developers use Google’s proprietary in-app billing for in-app game
`payments, as well as certain other digital in-app purchases;
`
`
`
`
`
`
`- 9 -
`CLASS ACTION COMPLAINT
`
`Case No. 5:20-cv-07365
`
`

`

`Case 5:20-cv-07365 Document 1 Filed 10/20/20 Page 12 of 19
`
`
`
`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
`
` Section 4.5, which has mandated that developers “may not use Google Play to
`distribute or make available any Product that has a purpose that facilitates the
`distribution of software applications and games for use on Android devices
`outside of Google Play”; and
` Section 8.3, which has broadly granted Google the right to remove any Android
`app it believes has violated any portion of the DDA.
`44. Mobile-app developers seeking access to Android users through the Google Play
`Store have had no choice but to accept Google’s demands or suffer precipitous declines in
`downloads and revenue due to a lack of access to the Google Play Store. Indeed, removal from the
`Google Play Store could mean that basic functions, such as automatic updating of apps in the
`background, which is available for apps downloaded from the Google Play Store, may be disrupted.
`Meanwhile, updating an app downloaded through a rival app store requires users to follow a multi-
`step, manual process each time an update is made available. The DDA thus enables Google to
`secure the most desired and highest quality mobile apps for itself while simultaneously foreclosing
`access by rival app stores.
`45.
`As the sole proprietor of the Google Play Store, Google has exercised its
`gatekeeping power to constrain competition and foreclose rival access. Numerous market
`participants have complained to Congressional staffers that Google uses arbitrary rule violations of
`various Google Play Store policies as a pretext for retaliatory conduct and to foreclose competition.
`46.
`In the absence of these unlawful restraints, high-quality mobile-app developers
`would be incentivized to offer their mobile apps on as many app stores as possible, expanding their
`exposure to users, generating additional downloads and revenue, and reducing the price that
`Plaintiff and Class Members pay for mobile apps and in-app purchases.
`
`ANTITRUST INJURY
`47.
`Plaintiff and Class Members have suffered antitrust injury as a direct result of
`Google’s unlawful conduct.
`48.
`Plaintiff and Class Members have purchased Android mobile apps and in-app digital
`content directly from Google through the Google Play Store.
`
`
`
`
`
`
`- 10 -
`CLASS ACTION COMPLAINT
`
`Case No. 5:20-cv-07365
`
`

`

`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-07365 Document 1 Filed 10/20/20 Page 13 of 19
`
`
`
`49.
`As described above, Google’s restrictive contracts and anticompetitive practices
`have foreclosed competition in the Android Mobile App Distribution Market and enabled Google
`to charge Plaintiff and Class Members supracompetitive prices for mobile app and in-app
`purchases.
`
`CLASS ACTION ALLEGATIONS
`50.
`Pursuant to Rule 23 of the Federal Rules of Civil Procedure, Plaintiff brings this
`action on behalf of herself and on behalf of the following class (the “Class”):
`
`All persons in the United States who, within the relevant statute of
`limitations (the “Class Period”): (1) paid for a mobile app on the
`Google Play Store; (2) paid subscription fees for a mobile app
`obtained on the Google Play Store; or (3) purchased in-app digital
`content from a mobile app that was downloaded at the Google Play
`Store.
`
`51.
`Excluded from the Class are the Court, Defendant and its parent, subsidiary, and
`affiliated entities, and their officers, directors, employees, affiliates, legal representatives,
`predecessors, successors, and assigns.
`52.
`Class Members are so numerous that joinder of all members is impracticable.
`Indeed, due to the nature of the trade and commerce involved, there are, perhaps, tens of millions
`of geographically dispersed Class Members, the exact number and identities of whom are known
`exclusively to defendant.
`53.
`Common questions of law and fact exist as to all Class Members and predominate
`over any questions affecting solely individual members of the Class. The questions of law and fact
`common to the Class include:
`
`a. Whether Google has monopoly power in the Android Mobile App
`Distribution Market;
`b. Whether Google’s contractual restrictions with OEMs furthered Google’s
`monopolization of the Android Mobile App Distribution Market;
`c. Whether Google’s contractual restrictions with mobile app developers
`furthered Google’s monopolization of the Android Mobile App Distribution
`Market;
`
`- 11 -
`CLASS ACTION COMPLAINT
`
`Case No. 5:20-cv-07365
`
`
`
`
`
`
`

`

`Case 5:20-cv-07365 Document 1 Filed 10/20/20 Page 14 of 19
`
`
`
`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
`
`d. Whether Google’s conduct resulted in supracompetitive prices for Android
`mobile apps;
`e. Whether Google’s conduct resulted in supracompetitive prices for in-app
`digital content purchases;
`f. Whether Google’s conduct has been detrimental to Plaintiff and Class
`Members; and
`The appropriate Class-wide measure of damages.
`g.
`54.
`Plaintiff’s claims are typical of the claims of the Class, as all Class Members were
`similarly affected by Google’s common course of wrongful