Battle between Apple and cryptocurrency scam victims

In an ongoing legal clash between Apple and users who fell victim to a fake cryptocurrency app, the consequences could extend far beyond the courtroom, potentially causing widespread disruption to mobile app marketplaces. This latest development has sparked concerns and led a coalition of tech industry organizations to advocate on Apple’s behalf, as reported by Media Post. 

At the heart of the dispute are Apple users who lost money after downloading the deceptive Toast Plus app, which falsely claimed to be a cryptocurrency wallet. The users allege that Apple should be held accountable, as they trusted the company’s assurance that its app store was a “safe and trusted place.” Apple, in response, argues that the claims are inextricably linked to the app’s content and are protected by Section 230 of the Communications Decency Act.

A coalition of tech-funded organizations, including the Chamber of Progress and NetChoice, the Electronic Frontier Foundation, and others, is raising concerns about the potential consequences of a ruling against Apple. In a friend-of-the-court brief filed with the 9th Circuit Court of Appeals, they argue that an Apple loss could lead to “disruption to the app markets” and could force app store providers to monitor millions of apps, potentially leading to the removal of most or all third-party apps. This, they suggest, could ultimately harm consumers and the creator economy that Apple supports.

The lawsuit against Apple was brought by Hadona Diep and Ryumei Nagao, who incurred losses from using the deceptive Toast Plus app. They contend that Apple’s statements about the safety of its app store are central to their claims and, therefore, Apple should be held responsible.

The coalition of tech industry organizations aligns with Apple’s stance, emphasizing that the core of the plaintiffs’ claims centers on harm resulting from third-party content. They argue that forcing companies like Apple to meticulously review apps in advance would have far-reaching negative effects on consumers, app developers, and the broader internet ecosystem. This could translate into fewer options, reduced competition in the digital marketplace, and disproportionate harm to marginalized voices that rely on app stores and third-party services for content distribution.

Despite successfully averting more than $2 billion in fraudulent transactions within the App Store last year, Apple remains embroiled in legal disputes. Notably, the company faced a significant legal challenge in July when a $1 billion class action lawsuit, representing over 1,500 UK app developers, targeted Apple over its App Store fee structure.