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Developers Sue Apple Over App Store Fees

Two Developers sued Apple Inc. (AAPL) over the sale and distribution of iOS apps on the company's App Store, alleging that the tech giant is abusing its monopoly position in its online marketplace.

The lawsuit, which was filed in federal court in California, claimed Apple cornered the market with its iOS App Store. It said that the company has charged developers a commission of 30% for nearly 11 years on selling apps and products within the apps.

Attorneys for the plaintiffs said Apple requires developers selling products through the App Store to pay an annual fee of $99, which hurts small and new developers.

"Between Apple's 30 percent cut of all App Store sales, the annual fee of $99 and pricing mandates, Apple blatantly abuses its market power to the detriment of developers, who are forced to use the only platform available to them to sell their iOS app," said Steve Berman, managing partner of Hagens Berman and attorney representing the proposed class of developers.

Berman said that the lawsuit seeks to force Apple to end its abusive monopoly and allow competition in the distribution of iOS apps and related products, to get rid of its pricing mandates, and to reimburse developers for overcharges made through abuse of its monopoly power.

Berman said, "After 11 years of monopoly conduct and profits, we think it's high time that a court examine Apple's practices on behalf of iOS app developers and take action as warranted by the law and facts."

Apple's Chief Executive Officer Tim Cook reportedly said that the company is "not a monopoly" and did not have a superior position in any market.

On Monday, there were reports that the U.S. Justice Department has agreed to handle potential antitrust investigations related to Apple and Alphabet Inc's (GOOGL,GOOG) Google, while the Federal Trade Commission would oversee investigations of Facebook Inc. (FB) and Amazon.com Inc. (AMZN).

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