CARY – Epic Games’ antitrust battle against Apple is turning – again – into what Apple declares as a “resounding victory.”

A decision Monday in the U.S. Ninth Circuit Court of Appeals affirmed a lower court decision that was considered largely a victory over Epic. The dispute involving apps offered through Apple’s App Store drew a strong statement by Apple to MacRumors, which has closely followed the case:

“Today’s decision reaffirms Apple’s resounding victory in this case, with nine of ten claims having been decided in Apple’s favor. For the second time in two years, a federal court has ruled that Apple abides by antitrust laws at the state and federal levels. 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. We respectfully disagree with the court’s ruling on the one remaining claim under state law and are considering further review.”

On Monday, Epic Games CEO Tim Sweeney tweeted his reaction to the court’s decision.

“Though the court upheld the ruling that Apple’s restraints have ‘a substantial anticompetitive effect that harms consumers’, they found we didn’t prove our Sherman Act case,” Sweeney tweeted. “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.”

MacRumors noted that even though Apple supports the court’s decision, it does disagree with an earlier ruling on the ‌App Store‌ changes. Apple is “considering further review,” MacRumors added.

“There is a lively and important debate about the role played in our economy and democracy by online transaction platforms with market power,” the three-judge court of appeals panel said, according to Bloomberg. “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.”

DECISION LANGUAGE

In the decision, the panel wrote “when Apple opened the iPhone to third-party app developers, it created a ‘walled garden,’ rather than an open ecosystem in which developers and users
could transact freely without mediation from Apple. Epic alleged that Apple acted unlawfully by restricting app distribution on iOS devices to Apple’s App Store, requiring in-app purchases on iOS devices to use Apple’s in-app payment processor, and limiting the ability of app developers to communicate the availability of alternative payment options to iOS device users. These restrictions
were imposed under the Developer Program Licensing Agreement (“DPLA”), which developers were required to sign in order to distribute apps to iOS users. The district court rejected Epic’s Sherman Act §§ 1 and 2 claims challenging the first and second restrictions, principally on the factual grounds that Epic failed to propose viable less restrictive alternatives to Apple’s restrictions. The district court concluded that the third restriction was unfair pursuant to the California UCL and enjoined Apple from enforcing it against any developer. The district court held that Epic
breached its contract with Apple but was not obligated to pay Apple’s attorney fees.”

Contrarian view

Epic  scored a “victory” over  Apple in its antitrust lawsuit even though Apple was not declared a monopoly and Epic will have to pay Apple several million dollars in the decision handed down by a federal judge, according to Raleigh tech attorney Jim Verdonik in September 2021 when the original decision was announced. And that one point remains in play.

“I understand that Apple stock fell 3% when the news of this ruling first came out,” Verdonik, who has written extensively about the antitrust case for WRAL TechWire, said at the time.

“That’s a loss of billions of dollars for Apple investors,” he added. “I think that’s the best indicator that this was a victory for Epic Games.”

The judge did rule that Apple must modify its App Store payments system, giving Epic an opportunity to participate again within the Apple iOS system. That decision was not changed in Monday’s decision, according to media reports.

Epic continues a similar antitrust against Google. A trial is scheduled in November.

Epic scores a victory in Apple court decision, Triangle attorney says

 

Spies & spooks take Apple’s side vs. Epic Games in antitrust suit over app store