Vmeetsolutions News
It appears as though we’ve been discussing this Epic versus Apple Fortnite lawsuit for quite some time now.
years
, it’s due to us having. The
The case has been ongoing since 2020.
, and ultimately concluded (at least partially) with a decision in 2021.
In essence, Apple requires developers selling digital products to route all transactions through its proprietary in-app purchasing system and subsequently charges them a fee as high as 30%. However, for vendors dealing with tangible items or services—such as Amazon or Uber—it allows the usage of alternative payment methods outside of its platform. Epic Games aimed to include an option within Fortnite enabling players to directly purchase the game’s “V-bucks” virtual currency via their website, thereby bypassing Apple’s fees.
In the past, Judge Yvonne Gonzalez Rogers determined that Apple was not considered a monopoly, but it
did
participate in practices that hinder fair competition as per the legal ruling and mandated the subsequent solution:
Apple… is henceforth prohibited indefinitely from preventing developers from incorporating into their applications and application metadata buttons, external links, or other prompts that guide users to purchase options outside of In-App Purchases. Additionally, Apple must not hinder communication between developers and customers acquired through voluntary registrations within the app.
Apple fought the decision for years, appealed to the 9th Circuit Court of Appeals, which confirmed it. Later, they took it to the Supreme Court, but the court chose not to hear the case.
After multiple postponements and evidentiary proceedings (which the court deemed as delaying tactics), Apple suggested imposing a significant 27% fee on transactions occurring outside the App Store, rather than the usual 30% charge for utilizing App Store payment methods. Additionally, they planned to enforce certain limitations on how applications could inform users about alternative purchasing options available externally.
Apple would provide discounts at that 27% rate to developers who take part in specific initiatives such as the Video Partner Program or News Partner Program.
Judge Rogers is not happy.
Apple’s compliance offer was not in keeping with the remedy imposed by the court back in 2021. In fact, one could say it’s just as bad or worse than the status quo, making it even harder to developers to simply sell their own things on their own sites without paying the so-called “Apple Tax.”
It was, in effect, a middle finger to the court, telling them that they’ll comply only under protest and in the most twisted way possible, to keep effectively charging all app developers its cut.
Judge Rogers is having
none of it
, writing:
It chose to defy this Court’s order and manufacture post hoc justifications for maintaining an anticompetitive revenue stream. Apple’s actions to misconstrue the Injunction continue to impede competition. This Court will not play “whack-a-mole,” nor will it tolerate further delay.
The judge concludes her document with this fierce wording:
Apple willfully chose not to comply with this Court’s Injunction. It did so with the express intent to create new anticompetitive barriers which would, by design and in effect, maintain a valued revenue stream; a revenue stream previously found to be anticompetitive. That it thought this Court would tolerate such insubordination was a gross miscalculation. As always, the cover-up made it worse. For this Court, there is no second bite at the apple.
Apple will have to face the consequences. The court has introduced multiple new regulations for Apple, summarized below:
· It must not charge any fees for transactions consumers make outside of the application, nor can it observe, trace, inspect, or mandate developers to disclose these external purchases.
· It cannot limit how developers decide to connect external purchase options; this includes aspects like the language used, format, position, sequence, or any other element.
· It cannot ban any type or class of app from acquiring the links required for external purchases within the application.
・It can’t interfere with the link out of the app in any way other than to have a neutral message that tells users they’re leaving the App Store to an external site.
The court is not giving Apple any time to make these changes—they are to take effect
immediately
. And Apple doesn’t get to file for a stay: “The Court will not entertain a request for a stay given the repeated delays and severity of the conduct.”
What’s more, the Judge has referred this matter to the U.S. Attorney for the Northern District of California to investigate whether or not this constitutes a
criminal
contempt charge.
Fortnite is coming back in the U.S.
In response to this ruling, Tim Sweeney (CEO of Epic Games) said that Fortnite will be coming back to the App Store in the U.S. beginning “next week.”
He also offered a truce of sorts, saying, “If Apple extends the court’s friction-free, Apple-tax-free framework worldwide, we’ll return Fortnite to the App Store worldwide and drop current and future litigation on the topic.”
But this has implications far beyond Fortnite. Now, any app developer that wants to sell in-app purchases on its own, outside of the App Store and Apple’s payment processing systems, can do so. They can simply put up a button or link anywhere they want and have you go to an external site to make your purchase, just as countless apps that sell physical goods and services can choose to do.
You can read the
entire court order here
.