Epic Games Triumph in Lawsuit Against Apple over In App Purchases

In a lawsuit started back in August 2020 we finally have a verdict, Epic Games won. Well, they mostly won, in that Apple is now no longer able to block application developers from linking to or offering 3rd party payment systems for in app purchases, the reason Fortnite was originally removed from the Apple app store.

Details of the ruling from the Verge article:

Under the new order, Apple is:

permanently restrained and enjoined from prohibiting developers from including in their apps and their metadata buttons, external links, or other calls to action that direct customers to purchasing mechanisms, in addition to In-App Purchasing and communicating with customers through points of contact obtained voluntarily from customers through account registration within the app.

In short, iOS apps must be allowed to direct users to payment options beyond those offered by Apple. The injunction is scheduled to take effect in 90 days — on December 9th — unless it is enjoined by a higher court.

That said, it wasn’t an absolute victory for Epic Games. Shortly after Epic Games sued Apple, Apple launched their own lawsuit seeking damages for lost earnings due to Epic Game’s offering of unauthorized IAP. In this case, Epic Games have lost:

At the same time, the court affirmed that Epic Games was in breach of its contract with Apple when it implemented the alternative payment system in the Fortnite app. As a result, Epic must pay Apple 30 percent of all revenue collected through the system since it was implemented — a sum of more than $3.5 million.

At the end of the day, the judge in the case, Judge Gonzalez-Rogers explained her ruling thusly:

“The relevant market here is digital mobile gaming transactions, not gaming generally and not Apple’s own internal operating systems related to the App Store,” Gonzalez-Rogers wrote.

Under that market definition, “the court cannot ultimately conclude that Apple is a monopolist under either federal or state antitrust laws,” she continued. “Nonetheless, the trial did show that Apple is engaging in anti-competitive conduct under California’s competition laws.”

This ruling is sure to have an impact on the on-going litigation between Epic Games and Google as a president setting case. It will also be interesting to see what happens if/when this is appealed to a higher court. The US legal system is not the only location where such a battle is being fought, in fact just last week South Korea ruled Apple and Google must offer 3rd party IAP in applications and multiple other lawsuits and investigations are underway.

You can learn more about the Epic Games v Apple lawsuit in the video below. At the end of the day, this is most likely a win for developers everywhere.

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