## Judge Rips Apple Over App Store Practices: “This is an injunction, not a negotiation!”
Apple’s App Store practices are once again under fire, and this time, a judge is not holding back. In a newly released 80-page decision, Judge Yvonne Gonzalez Rogers has come down hard on Apple, accusing the tech giant of defying court orders and engaging in anticompetitive behavior. The saga stems from the original case with Epic Games, the makers of Fortnite. While Apple largely won that initial battle, the court found them to be acting anticompetitively by restricting developers from offering alternative payment methods outside of Apple’s own platform.
The court ruled that developers should be allowed to link to other payment options within their apps, bypassing Apple’s hefty 30% commission on in-app purchases. Apple’s response, however, was deemed insufficient and even retaliatory. They only reduced the commission to 27% for external purchases and implemented “scare screens” designed to discourage users from choosing alternative payment methods. This 3% discount, coupled with the developers’ own payment processing fees, often made the alternative even more expensive.
Judge Rogers’ decision leaves no room for ambiguity about her feelings towards Apple’s actions. The ruling is peppered with scathing remarks and accusations, suggesting Apple knowingly circumvented the court’s injunction to protect its lucrative App Store business model.
Here are some of the most damning excerpts from the ruling:
**”Apple’s response to the Injunction strains credulity… Apple, despite knowing its obligations thereunder, thwarted the Injunction’s goals, and continued its anticompetitive conduct solely to maintain its revenue stream. Remarkably, Apple believed that this Court would not see through its obvious cover-up.”**
**”In stark contrast to Apple’s initial in-court testimony, contemporaneous business documents reveal that Apple knew exactly what it was doing and at every turn chose the most anticompetitive option. To hide the truth, Vice-President of Finance, Alex Roman, outright lied under oath.”**
The judge also criticized Apple CEO Tim Cook for siding with the company’s finance team over internal recommendations to comply with the original injunction. “Cook chose poorly,” the ruling states, referring the matter to the United States Attorney for the Northern District of California to investigate potential criminal contempt proceedings.
The judge emphasized the urgency of the situation, stating unequivocally: **”This is an injunction, not a negotiation. There are no do-overs once a party willfully disregards a court order. Time is of the essence. The Court will not tolerate further delays.”**
She further accused Apple of deliberately delaying proceedings to protect its profits, highlighting the company’s abuse of attorney-client privilege designations to obstruct transparency. This, she declared, “warrants sanction to deter future misconduct.” Apple is ordered to cover the full cost of special masters’ review and Epic’s attorneys’ fees related to this issue.
The ruling also points out Apple’s efforts to conceal its decision-making process, even going so far as to codename its compliance activities “Project Michigan.”
Further accusations of deception were leveled against VP of Finance Alex Roman, with the judge stating his testimony was “replete with misdirection and outright lies.” This included claims that Apple had no idea what fee it would impose on linked-out purchases until January 16, 2024, a claim directly contradicted by internal documents.
The infamous “scare screens,” designed to discourage users from using third-party payment options, were also scrutinized. The judge notes that Apple intentionally chose the most anticompetitive option, using full-screen takeovers and including the developer’s name to further dissuade users.
The court concludes that Apple not only violated the literal text of the injunction but also its spirit. The requirements for link-out transactions were deemed unjustified, particularly in comparison to the lack of restrictions for developers selling physical goods.
Ultimately, the court holds Apple in contempt, stating, **”Apple willfully chose not to comply with this Court’s Injunction. It did so with the express intent to create new anticompetitive barriers which would, by design and in effect, maintain a valued revenue stream; a revenue stream previously found to be anticompetitive. That it thought this Court would tolerate such insubordination was a gross miscalculation. As always, the coverup made it worse. For this Court, there is no second bite at the apple.”**
Apple has responded to the ruling, stating, “We strongly disagree with the decision. We will comply with the court’s order and we will appeal.” This legal battle is far from over, and its outcome will have significant implications for the future of the App Store and the power dynamics between Apple and app developers. The potential repercussions for Apple, including the possible criminal investigation of its executives, could be substantial. This case serves as a stark reminder that even tech giants are not above the law, and that anticompetitive behavior will be met with increasing scrutiny.