On Wednesday evening, a U.S. District Judge criticized Apple for disregarding an injunction related to the company’s U.S. App Store. This arose from a 2021 trial where Epic Games filed an antitrust lawsuit against Apple.
Although Apple emerged victorious in the initial trial, they were mandated to modify the App Store policies to permit alternate payment processing methods within apps. These alternative payments have become a significant source of income from the App Store. Following several stages of appeal, the injunction against Apple came into effect in January 2024.
In her decision issued on Wednesday, Judge Yvonne Gonzalez Rogers pointed out that Apple maintained a 27% cut from alternate payment methods instead of their standard 30%. Additionally, she highlighted that the company implemented measures aimed at deterring the utilization of these alternative systems.
Rogers has forwarded the case to the U.S. Attorney for the Northern District of California for potential criminal contempt charges.
Apple’s reaction to the injunction seems unbelievable,” Rogers stated. “Despite being aware of their responsibilities, Apple undermined the purpose of the injunction and persisted with anti-competitive behavior simply to keep up their income.
Rogers stated, “Contrary to Apple’s early court testimonies, internal company papers show that Apple was fully aware of its actions and consistently opted for the least competitive choice available.”
She urged Apple to adhere to the injunction without delay.
“This is an injunction, not a discussion,” she stated.
We have significant objections to this ruling,” an Apple representative stated to Barron’s. “While we will adhere to the court’s directive, we plan to file an appeal.
Apple’s stock dropped by 1.7% during post-market hours on Wednesday.
In recent years, investors have kept a close eye on Apple’s services revenue. “The potential threat lies with approximately $6 billion in US App Store earnings that Apple makes; however, we believe the effect might not be as significant because numerous developers are likely to still favor Apple’s platform,” noted Evercore analyst Amit Daryanani late Wednesday.
He points out that losing U.S. App Store revenue would decrease Apple’s earnings per share by about 30 cents, which equates to approximately 4% of the company’s projected profits for fiscal year 2025.
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