WASHINGTON: On Tuesday, the U.S. Supreme Court rejected Apple’s challenge to a lower court’s decision mandating modifications to certain rules in its profitable App Store. The justices opted out of the protracted legal dispute between Apple and Epic Games, the creator of the popular video game “Fortnite.”
The Supreme Court also dismissed Epic’s appeal of the lower court’s determination that Apple’s App Store policies, which restrict how software is distributed and paid for, do not violate federal antitrust laws. The reasons for the denial were not provided. Apple’s stock experienced a decline of over 2% in early Tuesday trading.
Epic CEO Tim Sweeney expressed his sentiments in a social media post, 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 did not immediately respond to requests for comment.
In 2020, Epic filed an antitrust lawsuit, alleging that Apple acted as an illegal monopolist by compelling consumers to obtain apps through its App Store and purchase digital content inside an app using its system, charging up to a 30% commission for in-app purchases.
In 2021, U.S. District Judge Yvonne Gonzalez Rogers rejected Epic’s antitrust claims against Apple but found that Apple violated California’s unfair competition law by prohibiting developers from “steering” users toward making digital purchases that bypass Apple’s in-app system. Epic contended that this could save users money with lower commissions.
The 9th U.S. Circuit Court of Appeals in San Francisco upheld much of Rogers’ decision in 2023, stating that Epic had “failed to prove the existence of substantially less restrictive alternatives” to Apple’s system.
The judge’s injunction requires Apple to allow app developers to provide links and buttons directing consumers to alternative methods of paying for digital content used in their apps.
Sweeney mentioned in his social media post, “As of today, developers can begin exercising their court-established right to tell US customers about better prices on the web.”
In its Supreme Court appeal, Epic argued that the 9th Circuit’s decision “guarantees severe anticompetitive harm and effectively insulates the most monopolistic tech-platform practices from antitrust scrutiny.”
Apple, in its appeal, noted that Epic did not file a class-action lawsuit and contended that the broad injunction imposed by Rogers exceeds the constitutional authority of federal courts, typically limited to providing relief to the parties directly involved.