Apple’s court battle with Epic Games is into its second week. Essentially, it all centers around Epic accusing Apple of violating antitrust law and Apple alleging that Epic violated its developer agreement. As legal expert John Voorhes noted, the case is very high stakes. In many ways, it could define the future of the App Store and iOS more widely.
Initial Legal Arguments from Epic Games and Apple
Legal arguments put forward by Apple prior to the trial insisted its 30 percent commission isn’t anticompetitive. Its court submission said:
Epic has benefited handsomely from its contractual relationship with Apple. Epic has used Apple’s proprietary SDKs, and thousands of proprietary APIs to develop games for iOS users.
Obviously, the Fortnite-maker doesn’t agree.
Apple also rejected the notion that the App Store had operating margins of nearly 78 percent in the fiscal year 2019, which an expert witness for Epic Games put forward.
On the first day of the trial, Epic Games presented emails from Phil Schiller, who runs the App Store. They revealed that back in 2011 Mr. Schiller, now an Apple Fellow, asked services chief Eddy Cue whether “we think our 70/30 split will last forever?” He described himself as a “staunch supporter” of the fee, but said he didn’t think it could remain “unchanged forever.” Mr. Schiller even posited dropping the fee to 20 or 25 percent if that maintained US$1 billion in profits from the Apple Store.
Also in the first week of the trial, there was a debate about the definition of a game vs an app. Roblox is apparently an app, although it’s defined as a game on the App Store. Minecraft is a game. Keeping up at the back? Either way, the approach didn’t go particularly well for Apple’s Trystan Kosmynka, The Verge reported.
‘It’s Just a Banana, Ma’am’
As well as staid legal and financial arguments, there’s been some humor too. For example, Monday saw a row about a banana wearing clothes. When cross-examining Matthew Weissinger, Epic Game’s VP of marketing, Apple’s attorney focussed on how the character Peely can wear a tuxedo (and be named Agent Peely). After showing Peely in a tux whilst guiding the court through how to set up in Fortnite, the lawyer quipped: “We thought it better to go with the suit than the naked banana, since we are in federal court this morning.”
This might sound like a silly line, but it was relevant enough for Epic’s own lawyer to return to the topic, commenting during cross-examination “There might have been an implication that to show Peely without a suit would have been inappropriate.”
The lawyer then asked Mr. Weissinger there is “anything inappropriate about Peely without clothes?” The reply: “It’s just a banana, ma’am.”
As The Verge noted, this wasn’t a throw-away line. During the first week in court, Apple accused Epic of hosting porn, saying that the Itch.io storefront, which can be accessed via the Epic Games Store, provided access to “so-called adult games.” These had descriptions “not appropriate for us to speak in federal courts,” as they are “both offensive and sexualized,” according to the attorney. This is the core of Apple’s argument – making everything go through the App Store maintains quality for users.
By pure coincidence, Apple announced yesterday that it stopped over US$1.5 billion fraudulent transactions in 2020. Furthermore, it revealed it had rejected almost one million problematic new apps, as well as nearly one million app updates.
The trial continues…
[Image credit: Ascannio / Shutterstock.com]