Apple has claimed a “resounding victory” after the ruling in its legal battle with Epic Games was upheld by the US Court of Appeal.
As Bloomberg reports, The US Ninth Circuit Court of Appeals upheld a ruling by US District Court Judge Gonzalez Rogers in 2021, who rejected nine of Epic’s ten claims that Apple violated federal law by banning competing marketplaces on iOS.
Judge Gonzalez Rogers agreed with Epic that Apple’s App Store rules could constitute unfair competition under California law. These ‘anti-steering’ violations stem from Apple prohibiting the use of or promotion of alternative payment options inside apps on the App Store.
Rogers then ordered Apple to allow developers in the US to place links to other payment options within their iPhone apps, thus making it easier for developers to circumvent Apple’s 30% commission which would potentially cost the iPhone maker billions of dollars in revenue. Apple had appealed this part of Gonzalez Rogers’ decision but this was upheld by the appeals court on Monday.
In their ruling, appeal court Judges Milan D. Smith Jr. and Michael J. McShane and Sidney R. Thomas said: “There is a lively and important debate about the role played in our economy and democracy by online transaction platforms with market power,” continuing with “our job as a federal court of appeals, however, is not to resolve that debate — nor could we even attempt to do so. Instead, in this decision, we faithfully applied existing precedent to the facts.”
Apple said it’s assessing whether it will contest the appeals court’s findings on this issue. In a statement emailed to Bloomberg, they added: “We respectfully disagree with the court’s ruling on the one remaining claim under state law and are considering further review.”
However, Apple claimed the rest of the ruling was a “resounding victory” The iPhone maker stated: “The App Store continues to promote competition, drive innovation, and expand opportunity, and we’re proud of its profound contributions to both users and developers around the world.”
On Twitter Epic CEO, Tim Sweeney stated although Apple prevailed in the 9th Circuit Court, at least the appeals court kept intact the portion of the 2021 ruling that sided with Epic, he was pleased that the court upheld the ruling that Apple’s restraints have “a substantial anticompetitive effect that harms consumers.”
He added: “Fortunately, the court’s positive decision rejecting Apple’s anti-steering provisions frees iOS developers to send consumers to the web to do business with them directly there. We’re working on next steps.” Epic initially sued Apple in August 2020 after they added a new way to obtain V-Bucks straight from Epic within the Fortnite iOS app. This circumvented Apple’s 30% platform fees, which led to Apple removing the game from the App Store and terminating Epic’s developer account.
Following the original 2021 ruling, Epic CEO Tim Sweeny asked Apple if they could reactivate their iOS development account and promised to adhere to Apple’s guidelines whenever they released products on Apple platforms. Apple refused and stated that it wouldn’t consider allowing Fortnite (or any of Epic’s games for that matter) back on the App Store until their legal proceeding had concluded.
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