Apple wins appeals court ruling against Epic Games
An appeals court has issued a ruling in the longstanding antitrust dispute between Apple and Epic Games. As Bloomberg The US Court of Appeals for the Ninth Circuit reportedly upheld a lower court ruling, which rejected most of Epic’s claims that Apple violated federal competition law by banning alternative app stores on its devices. . The three-judge panel also upheld a portion of the original ruling that was in favor of Epic.
“There is a lively and important debate about the role that online trading platforms with market power play in our economy and democracy,” the panel wrote in the decision. “However, our job as a federal appeals court is not to resolve that debate, nor could we even attempt to. Instead, in this decision, we faithfully applied existing precedent to the facts.”
The ruling maintains the status quo, unless further appeals take the case to a higher court. An additional wrinkle is the fact that Epic may now be on the lookout for Apple’s legal fees, as they AxiosStephen Totillo he pointed
“Today’s decision reaffirms Apple’s overwhelming victory in this case, with nine out of ten claims decided in Apple’s favor. For the second time in two years, a federal court has ruled that Apple complies with state and federal antitrust laws,” Apple told Engadget in a statement. “The App Store continues to promote competition, drive innovation and expand opportunity. and we are proud of their profound contributions to both users and developers around the world. We respectfully disagree with the court’s ruling on the only remaining claim under state law and are considering further review.”
Shortly after the ruling was published, Epic CEO Tim Sweeney posted the following statement on his Twitter account:
Apple prevailed in the Ninth Circuit Court. Although the court upheld the ruling that Apple’s restrictions have “a substantial anticompetitive effect that harms consumers,” they found that we did not prove our Sherman Act case.
—Tim Sweeney (@TimSweeneyEpic) April 24, 2023
In a follow-up tweet, he said: “Thankfully, the court’s positive decision throwing out the provisions against Apple’s direction frees up iOS developers to send consumers to the web to do business with them directly there. We’re working in the next steps.”
In the original 2021 ruling, U.S. District Judge Yvonne Gonzalez Rogers found that while Apple was preventing users from paying less for apps or in-app purchases, it was not running the App Store like a monopoly. Still, Rogers told Apple to allow developers to direct users to alternative payment systems, which would have allowed them to circumvent the 15 to 30 percent cut Apple typically takes from in-app purchases.
Apple won a last-minute delay in implementing those changes. However, in 2022, it began allowing the creators of certain apps to redirect users to their own websites to make payments and fully manage their accounts.
Engadget has contacted Epic for comment. The company has made similar antitrust claims in a lawsuit against Google, and that case will go to trial in November.
Epic kicked off its battles against Apple and Google when it offered Fortnite Mobile players a cheaper way to pay for in-game currency that bypasses the iOS and Android payment systems. Apple and Google removed Fortnite from their app stores, and Epic responded with lawsuits against both companies.
Regardless of the end result in both cases, Apple and Google may support third-party app stores on iOS and Android anyway. Regulators in other markets have scrutinized the app store practices of both companies. As a result of new European Union laws in particular, Apple is preparing to allow third-party markets on the iPhone as early as next year. If and when it does, Epic’s own mobile app store is ready to go, according to CEO Tim Sweeney. Microsoft is also preparing its own mobile app store.
Update, 4/24/23, 4:23 pm ET: Added statement from Epic CEO Tim Sweeney.