US Supreme Court snubs Epic Games legal battle with Apple

By Andrew Chung

WASHINGTON (Reuters) -The U.S. Supreme Court on Tuesday declined to hear an antitrust challenge by Epic Games, maker of the popular video game “Fortnite,” to the way Apple runs its lucrative App Store, handing the software company a setback in its lengthy legal battle against the iPhone maker.

The justices turned away Epic’s appeal of a lower court’s decision that Apple’s App Store policies limiting how software is distributed and paid for do not violate federal antitrust laws. The justices also decided not to hear Apple’s appeal of the same decision, which barred certain App Store rules.

Epic filed an antitrust lawsuit in 2020, accusing Apple of acting as an illegal monopolist by requiring consumers to get apps through its App Store and buy digital content inside an app using its own system. Apple charges up to a 30% commission for in-app purchases.

U.S. District Judge Yvonne Gonzalez Rogers in 2021 rejected Epic’s antitrust claims against Apple. But the judge found that Apple violated California’s unfair competition law by barring developers from “steering” users to make digital purchases that bypass Apple’s in-app system, which Epic contends could save them money with lower commissions.

The San Francisco-based 9th U.S. Circuit Court of Appeals upheld much of Rogers’ decision in 2023, finding that Epic had “failed to prove the existence of substantially less restrictive alternatives” to Apple’s system.

The judge’s injunction requiring Apple to let app developers provide links and buttons that direct consumers to other ways to pay for digital content that they use in their apps is on hold while Apple’s appeal plays out. The Supreme Court in 2023 denied a bid by Epic to let the injunction take effect.

In its appeal to the Supreme Court, Epic had said that the 9th Circuit’s decision “guarantees severe anticompetitive harm and effectively insulates the most monopolistic tech-platform practices from antitrust scrutiny.”

Apple had noted in its appeal that Epic did not file a class-action lawsuit and said the broad injunction imposed by Rogers exceeds the constitutional authority of federal courts, which typically should be limited to providing relief to the parties before them.

(Reporting by Andrew Chung; Editing by Will Dunham)