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Apple v Epic alternative payment links dispute now in the Ninth Circuit appeals court

By | Published on Tuesday 30 November 2021

Epic Games logo

The battle over whether or not Apple will have to allow all app makers on the iOS platform to sign-post alternative payment options from later this month is now before the Ninth Circuit Appeals Court in the US.

This is part of the ongoing dispute between Apple and Fortnite make Epic Games over the former’s App Store rules, which the latter claims are anti-competitive. Although when Epic took its competition law arguments against Apple to a court in California most of them failed, that court nevertheless issued an injunction very much in the gaming firm’s favour.

This relates to the App Store rule that says that, on many iOS apps, in-app payments must be taken via Apple’s own commission-charging transactions platform. Not only that, but an app maker can’t include links in the app that take users to web pages elsewhere on the internet where other payment platforms can be accessed.

This has long been a top gripe of many app makers, including Spotify. Although – as part of a deal with a regulator in Japan – Apple will next year start allowing the makers of so called reader apps, which includes Spotify, to start including links to alternative payment platforms within their iOS apps.

But that doesn’t help Epic. However, the injunction it secured in the Californian courts forces Apple to start allowing all app makers to include such alternative payment option links, within the US at least. That injunction is due to go into force on 9 Dec.

Needless to say, Apple opposes the injunction, mainly arguing that – because the rest of its legal dispute with Epic is subject to appeal – the court order regarding alternative payment links should be paused pending that appeals process.

However, the judge who oversaw the original case declined to pause her injunction. She stated earlier this month that Apple’s motion to have the injunction postponed “is based on a selective reading of this court’s findings and ignores all of the findings which supported the injunction, namely incipient antitrust conduct including super-competitive commission rates resulting in extraordinarily high operating margins and which have not been correlated to the value of its intellectual property”.

Having failed to get the injunction paused in the lower court, Apple took the matter to the Ninth Circuit appeals court, arguing that enforcing said injunction at this time would “harm customers, developers, and Apple itself”.

Needless to say, Epic does not agree. Filing a motion with the Ninth Circuit last week urging the appeals court to uphold the injunction, it argued that Apple will not suffer “irreparable injury” as a result of the injunction, that delaying – or ‘staying’ – the lower court’s order would harm Epic, and that “the public interest favours denial of stay”.

On the latter point, it went on: “The [lower] court’s injunction increases consumer choice on a platform where Apple had ‘actively denied’ it for more than a decade. As the court wrote: ‘this measured remedy will increase competition, increase transparency, increase consumer choice and information’. The court expressly found the injunction will further ‘the public interest in uncloaking the veil hiding pricing information on mobile devices and bringing transparency to the marketplace'”.

It then added: “Apple will not voluntarily provide any relief to consumers and developers absent a court order. The public interest thus heavily favours denial of Appleā€™s motion”.

We now await to see how the appeals court responds.