The Associated Press is reporting that a class-action lawsuit against Apple and AT&T's mobile phone business has received the OK to proceed from a federal judge. Grounds for the suit is alleged monopoly abuse.
The lawsuit reportedly merges several suits filed by iPhone buyers starting in late 2007 and seeks an injunction to keep Apple from selling "locked" iPhones, which can be used on the AT&T mobile network only, in the United States. It also seeks to prevent Apple from maintaining its authority to dictate what iPhone programs users can and can't install on their devices, according to the AP story.
Another allegation is that Apple secretly made AT&T its exclusive iPhone partner in the U.S. for five years. When consumers agreed to two-year contracts with AT&T when they purchased their phones, they were in effect locked into a five-year relationship with AT&T, the lawsuit reportedly argues. The class includes anyone who bought an iPhone with a two-year AT&T agreement since the device first went on sale in June 2007.
Whether Apple and AT&T's prior and current actions have hurt competition and driven up prices for consumers is at the heart of the suit and will form the crux of a nationwide controversy, should the class action indeed move forward.
Earlier this year, the Federal Communications Commission released its 14th Annual Mobile Wireless Competition Report to Congress, in which it assumed a neutral stance on the state of competition in the U.S. wireless industry. This was the first time since 2002 that the agency didn't flat-out find "effective competition" in the industry -- a decision likely affected, at least in part, by industry-wide questions over Apple and AT&T's behavior.