The U.S. Supreme Court has rejected Apple’s challenge to a lower court’s ruling that required changes to certain rules in the company’s App Store. This decision effectively ends the lengthy legal battle between Apple and Epic Games, the creator of the popular video game Fortnite. The court also declined to hear Epic’s appeal of the lower court’s decision, which stated that Apple’s App Store policies did not violate federal antitrust laws. As a result of the news, Apple’s stock fell more than 2% during early trading on Tuesday.
Epic Games filed an antitrust lawsuit against Apple in 2020, accusing the tech giant of acting as an illegal monopolist by forcing consumers to use the App Store for app downloads and in-app purchases. Apple charges developers a commission of up to 30% for these in-app purchases. While U.S. District Judge Yvonne Gonzalez Rogers rejected Epic’s antitrust claims, she did find Apple in violation of California’s unfair competition law by prohibiting developers from steering users to alternative payment methods that bypass Apple’s system.
The 9th U.S. Circuit Court of Appeals upheld most of Judge Rogers’ decision in 2023, ruling that Epic had failed to prove the existence of less restrictive alternatives to Apple’s system. The court’s injunction requires Apple to allow app developers to provide links and buttons that direct consumers to other methods of payment for digital content within their apps.
Epic Games CEO Tim Sweeney expressed disappointment in the Supreme Court’s decision, stating, The court battle to open iOS (Apple’s mobile operating system) to competing stores and payments is lost in the United States. A sad outcome for all developers. Apple has not yet commented on the decision.
Both Epic Games and Apple had appealed to the Supreme Court, with Epic arguing that the lower court’s decision shields monopolistic practices from antitrust scrutiny and causes severe anticompetitive harm. Apple, on the other hand, claimed that the broad injunction imposed by the lower court exceeds the constitutional authority of federal courts.
This development has significant implications for developers and consumers alike. As of now, app developers can exercise their right to inform U.S. customers about better prices available on the web. However, this ruling also signifies a setback for those who were hoping for broader changes to Apple’s App Store policies.
While the Supreme Court’s decision puts an end to this legal battle, the debate surrounding app store regulations and antitrust issues in the world of technology is far from over. The outcome of this case may inspire further discussions and potential legislative or regulatory actions to address the concerns raised by developers and consumers regarding the market power of dominant tech platforms.
It remains to be seen how this decision will impact the app ecosystem and competition in the industry going forward. Nonetheless, it marks a significant moment in the ongoing discussions surrounding the App Store and the power of major players in the digital marketplace.
