‘Fortnite’ Creator Fights Apple’s Antitrust Ruling During Appeal Hearing

SAN FRANCISCO, Nov 14 (Reuters) – Epic Games argued before a three-judge federal appeals panel on Monday to overturn parts of a lower court antitrust ruling that overwhelmingly favored Apple Inc (AAPL.O) and its App Store payment business.

The “Fortnite” creator sued Apple in 2020, alleging the iPhone maker illegally compelled software developers to pay him commissions of up to 30% on in-app purchases.

After a three-week trial last year, a judge did not call Apple an “illegal monopoly” and concluded that Epic had failed to prove that the privacy and security benefits of commissions and related policies outweighed the costs to consumers.

On Monday, the U.S. Ninth Circuit Court of Appeals panel questioned attorneys for Epic, Apple and the U.S. Department of Justice on whether the trial judge properly compared those consequences.

Epic acknowledged that it had not provided enough evidence on certain points. Apple reiterated that the developer fee helps it fund app review to ensure consumers are not exposed to fraudulent, pornographic or privacy-intrusive apps.

Key to the trial judge’s ruling was his finding that Apple’s contracts with developers to use its App Store did not violate antitrust laws because they were non-negotiable agreements – developers either agree or couldn’t use the app store. Epic argues that these standard agreements are still subject to antitrust laws.

Other large technology companies use similar agreements to protect access to their systems. The Justice Department, which has investigated Apple and other tech companies, joined Epic’s appeal because it said the lower court’s decision could “significantly harm the enforcement of antitrust laws beyond the specific context of this case”.

The trial court also found that Apple violated the unfair competition law of its home state of California and ordered the company to let developers tell users how to make in-app purchases outside of it. of its proprietary payment system. The appeal committee may reconsider this order.

Reporting by Paresh Dave in San Francisco; Additional reporting by Stephen Nellis in San Luis Obispo County, California; Editing by Rosalba O’Brien and Stephen Coates

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Paresh Dave

Thomson Reuters

San Francisco Bay Area-based tech journalist covering Google and the rest of Alphabet Inc. Joined Reuters in 2017 after four years at the Los Angeles Times focusing on the local tech industry.