On Tuesday, the US Supreme Court chose not to consider an appeal from Apple regarding a lower court’s mandate for alterations to specific regulations governing its App Store. This decision marks another chapter in the ongoing legal skirmish between Apple and Epic Games, the developer behind the widely popular game Fortnite.
Additionally, the justices dismissed Epic’s appeal concerning a previous ruling that deemed Apple’s App Store practices, which control software distribution and payments, as compliant with federal antitrust legislation. The court provided no rationale for its choice to reject the appeals.
Following the announcement, Apple’s stock experienced a dip of more than 2 percent in early trading.
Tim Sweeney, CEO of Epic Games, expressed his discontent through a post on social media, stating, “The court battle to open iOS to competing stores and payments is lost in the United States. A sad outcome for all developers.”
The Supreme Court denied both sides’ appeals of the Epic v. Apple antitrust case. The court battle to open iOS to competing stores and payments is lost in the United States. A sad outcome for all developers.
— Tim Sweeney (@TimSweeneyEpic) January 16, 2024
Apple has not yet responded to inquiries for comment.
The conflict began when Epic filed an antitrust lawsuit in 2020, accusing Apple of monopolistic practices by mandating that consumers obtain apps through its App Store and requiring the use of its own payment system for in-app purchases. Apple retains a commission of up to 30 percent on these transactions.
In 2021, US District Judge Yvonne Gonzalez Rogers dismissed Epic’s antitrust allegations against Apple. However, she determined that Apple had violated California’s unfair competition laws by preventing developers from directing users towards alternative purchasing options outside of Apple’s payment system, which Epic argued could reduce costs through lower fees.
The 9th US Circuit Court of Appeals largely upheld Judge Rogers’ ruling in 2023, concluding that Epic had not substantiated the existence of significantly less restrictive alternatives to Apple’s model.
Furthermore, the ruling included an injunction requiring Apple to allow app developers to offer links and buttons leading consumers to other payment methods for digital content used within their applications.
Sweeney’s social media message highlighted a new opportunity for developers, stating, “As of today, developers can begin exercising their court-established right to tell US customers about better prices on the web.”
In its petition to the Supreme Court, Epic contended that the 9th Circuit’s decision would result in substantial anticompetitive damage and effectively shield the most monopolistic tech-platform tendencies from antitrust examination.
Apple, in its counter-appeal, noted that Epic had opted not to pursue a class-action lawsuit and argued that the extensive injunction imposed by Judge Rogers exceeded the constitutional limits typically governing federal court authority.
© Thomson Reuters 2024
