Should Apple Pay For The Bad Deeds Of Its App Makers?

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A sprawling lawsuit filed in Texas this week targets Path, Instagram, Facebook and others for instructing their apps to suck up user address book data without permission. But the most interesting part of the case may be Apple’s role in the affair and whether it had a legal duty to police the app makers.

The 152-page lawsuit, filed in Austin by veteran business lawyers, may also help shape the rules of what Silicon Valley can and can’t do with the personal data that sits in every smart phone.

The address book issue first gained widespread attention in February when the media reported that Path, a social sharing app, was helping itself to users’ contacts without permission. The incident also produced rumors that many other tech companies had been quietly doing the same thing.

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A Path-related lawsuit has been anticipated for some time and now it’s arrived with a vengeance. It appears plaintiff attorneys were taking their time in search of deeper pockets and now have found them. In addition to Path, the other defendants include Twitter, Electronic Arts (maker of Cut-the-Rope), Yelp, LinkedIn and Angry Birds maker Rovio.

The plaintiffs, who want to represent every iPhone and Android phone user who downloaded the apps, say the companies violated federal computer and racketeering laws as well as a series of California and Texas state laws.

They add that Apple too should pay millions for “aiding and abetting” the app makers and failing to enforce its own policies.

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The claim against Apple is interesting because the lawsuit also describes how the Amazon App Store for Android and the Google Android Market (now Google Play) sell the offending apps but yet it doesn’t name them as defendants.

According to plaintiff lawyer, Carl Schwenker, this was a “strategic” decision that resulted from Apple having a “closed system” that gives the company a “significantly larger amount of control” over how the apps are used. Schwenker also suggested Apple is liable because its iOS developer library provided information that allowed the app makers to harvest address books without permission.

The lawsuit itself portrays Apple and its late founder as scheming and hypocritical over privacy issues:

For example, Apple has rejected Apps for competitive reasons .. and occasionally even for moral reasons. Mr. Jobs further expressed that Apple’s control over the approval of Apps for iOS-­‐‑system devices was instituted, in part, to provide device owners “freedom from programs that steal your private data” [..]

Apparently, [Instagram’s] non‑compliance with Apple’s own App Store policies and developer agreements is not a disqualifier for Apple’s “App of the Year” award […]

If not for Apple’s assistance, encouragement and support, the defendants’ Trojan-­horse-‑like Apps would never have been available to the iOS-­‐‑device user marketplace over the AppStore

Apple is likely to respond in court by stating that it simply provided developer tools like any other publisher, and that it’s not responsible for app makers that misuse them. I’ve reached out to Apple but the company almost never comments on lawsuits.

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Schwenker, the plaintiffs’ lawyer, says the lawsuit is a seminal one in which consumers are “really looking to see reform in the industry.”

The legal case is likely to take further shape this summer when Apple and the other companies respond or file motions to dismiss.

Republished with permission from paidContent, which writes about the transformation of the media-and-entertainment industries in the digital era, with a focus on emerging-business models and technologies.

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