Major win for Epic Games: Apple has 90 days to open up app store payments
App happs —
Permanent injunction caps Epic Games’ year-long legal offensive against Apple.
On Friday, the Northern California judge handling the closely watched Epic Games v. Apple court case turned in a ruling that, in many ways, works out in Apple’s favor—but with one massive, App Store-changing exception.
The ruling from US District Judge Yvonne Gonzalez Rogers includes a single-page permanent injunction demanding that Apple open up payment options for any software sellers on the App Store. In other words, Epic Games’ effort to add Epic-specific payment links inside the free-to-play game Fortnite, and thus duck out of paying Apple’s 30 percent fee on in-app transactions, can now happen.
The injunction is aimed at Apple, not Epic, and tells the device and software manufacturer to no longer prevent developers from including their own direct-buy links within their apps. Apple also cannot prevent app-makers from communicating with customers via any method customers opt in to (i.e. an email newsletter) about purchasing options. Apple has 90 days from today, September 10, 2021, until this injunction becomes live and actionable.
Not an antitrust violation
The giant 185-page ruling opens by making clear that one of the larger allegations of the lawsuit, that Apple engaged in antitrust behavior, doesn’t quite pass muster. Apple has pointed to this detail in its own statement on the ruling:
Today, the court has affirmed what we’ve known all along: the App Store is not in violation of antitrust law. As the court recognized, “success is not illegal.” Apple faces rigorous competition in every segment in which we do business, and we believe customers and developers choose us because our products and services are the best in the world. We remain committed to ensuring the App Store is a safe and trusted marketplace that supports a thriving developer community and more than 2.1 million U.S. jobs, and where the rules apply equally to everyone.
While Epic Games’ general stance about payment options on the App Store has succeeded, leading to the injunction, Epic itself faces consequences due to the court not finding Apple in breach of contract. In particular, Epic must pay damages to Apple to make up for the 30 percent cut of Fortnite in-app purchases that would have been paid by Epic to Apple in the first place, had Fortnite not instituted its own payment model for three months in 2020. That amount alone is $3.65 million, and the ruling mentions other damages as well.
Additionally, because Apple’s decision to cut off Epic Games’ developer account within the Apple ecosystem was, according to the ruling, “valid, lawful, and enforceable,” Apple can continue to not let Epic Games return to the App Store as a licensed and approved developer.