SAN FRANCISCO (AP) — Apple is heading for a courtroom showdown against the company behind popular video game Fortnite, reigniting a high-stakes antitrust battle over whether the digital fortress protecting the app store from the iPhone illegally enriches the world’s most valuable company while stifling competition.
Oral arguments on Monday before three judges of the Ninth Circuit Court of Appeals are the latest round in a legal battle over an app store that provides a wide range of products to more than a billion iPhones and serves as the backbone of Apple’s $2.4 trillion empire.
This is a dispute that is likely to remain unresolved for a long time. After hearing Monday’s arguments in San Francisco, the appeals court is not expected to rule for six months to a year. The issue is so important to both companies that the losing side is likely to take the fight to the U.S. Supreme Court, a process that could stretch into 2024 or 2025.
The brawl dates back to August 2020 when Epic Games, the maker of Fortnite, filed an antitrust lawsuit in an attempt to erase the walls that have given Apple sole control of the iPhone app store since its inception there. 14 years old.
This rock-solid control over the App Store has allowed Apple to impose commissions that enable it to discount purchases made for digital services sold by other companies by 15-30%. By some estimates, those commissions earn Apple $15 billion to $20 billion a year — revenue that the Cupertino, Calif.-based company says helps defray the cost of technology for the iPhone and a store that now contains nearly 2 million mostly free applications.
U.S. District Judge Barbara Gonzalez Rogers sided almost entirely with Apple in a 185-page decision handed down 13 months ago. This followed a closely watched trial that included testimony from Apple CEO Tim Cook and Epic CEO Tim Sweeney, as well as other senior executives.
Although she said that Apple’s exclusive control over iPhone apps was not a monopoly, Gonzalez Rogers opened a loophole that Apple wants to close. The judge ordered Apple to allow apps to provide links to payment alternatives outside the App Store, a requirement that was deferred until the appeals court ruled.
Monday’s arguments are set to open with Epic attorney Thomas Goldstein trying to persuade the trio of judges – Sidney R. Thomas, Milan D. Smith Jr. and Michael J. McShane – why Gonzalez Rogers should have watched the iPhone app store and system payment as separate marketplaces instead of lumping them together.
A Justice Department lawyer will also have the opportunity to explain why the agency believes Gonzalez Rogers interpreted federal antitrust law too narrowly, jeopardizing future enforcement action against potentially anticompetitive behavior in the US. tech industry. While the department isn’t technically taking sides, its arguments should help Epic argue that the appeals court should overturn the lower court’s decision.
Another attorney from the California Attorney General’s office will present arguments defending the law that Gonzalez Rogers cited in ordering Apple to provide links to other payment methods outside of its app store.
Apple attorney Mark Perry will have the chance to make closing arguments, which will give him the opportunity to tailor a presentation aimed at answering some of the questions the judges might pose to the attorneys before him.
Much of what Perry says is likely to echo the successful case Apple brought to the lower court.
During testimony in lower court, Cook argued that forcing Apple to allow alternative payment systems would weaken security and privacy controls prized by consumers who buy iPhones instead of devices running Apple’s Android software. Google. This scenario would create “a kind of toxic mess,” Cook warned on the witness stand.
Even as he railed against Apple’s ironclad grip on the App Store, Sweeney admitted that he owns an iPhone himself, in part because of its security and privacy features.
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