Epic Games may have lost most of its major case against Apple, but it isn’t giving up without a fight – and it has some powerful allies on its side. Epic Games filed an appeal shortly after the Epic Games v. Apple decision was published, and on January 27th, a coalition of 35 state attorneys general, Microsoft, and the Electronic Frontier Foundation filed amicus briefs in support of Epic’s case (EFF).
Throughout the battle, Epic argued that Apple has a monopoly on iOS apps and demanded reforms that would effectively force Apple to take a lesser percentage of all transactions that pass through its store.
If Epic is successful in convincing Apple to accept alternative payment processors, for example, it might have a significant impact on how Apple, the world’s most profitable corporation, operates its highly valuable App Store. The judge decided in favour of Apple in nine of the ten counts Epic made against it in the first lawsuit, but both Epic and Apple appealed the parts they lost.
Epic claimed in a first-round appeal brief filed last week that upholding the verdict “would upend established principles of antitrust law and…undermine the effective antitrust policy.”
Now, it appears that more than half of the states in the United States, Microsoft, and a slew of other organizations filing amicus briefs (briefs filed by non-parties to a case to add additional information that may be relevant) are siding with Epic, the company that lost all but one count in the original ruling because they believe Apple may have a monopoly as well.
“Apple’s conduct has harmed and is harming mobile app developers and millions of citizens,” the states said in their brief. “Meanwhile, Apple continues to monopolize app distribution and in-app payment solutions for iPhones, stifle competition, and amass super competitive profits within the almost trillion-dollar-a-year smartphone industry. Apple must account for its conduct under a complete rule of reason analysis.”
“A broad ruling for Apple could leave little room for a limiting principle to prevent Apple from leveraging its control of iOS to foreclose competition in countless adjacent markets,” Microsoft said. “Google, the only other mobile operating system provider, could be empowered to do the same. The stakes are high for Microsoft and other businesses that depend on antitrust laws to protect competition on the merits.” (It should be noted that Microsoft was a key ally with Epic during the bench trial, as Epic even called Microsoft to the stand to testify.)
“A holistic review of the district court’s factual findings will show that Apple does have market power in-app distribution and that its proffered justifications for its restrictive App Store policies do not outweigh the anticompetitive effects of those policies,” the EFF said in the conclusion to its brief. “Accordingly, this Court should find Apple’s policies to be illegal under the Sherman Act. This result will leave Apple free to continue innovating for the benefit of its users while allowing innovation to flourish outside of Apple’s walls as well.”
Here is the list of organizations that have filed amicus briefs:
- The coalition of 35 states led by Utah
- The Electronic Frontier Foundation (EFF)
- The Consumer Federation of America and the developer’s Basecamp (the makers of the Hey email app), Match Group, and Knitrino
- Public Citizen
- The Committee to Support the Antitrust Laws
- The American Antitrust Institute
- A group of 14 law, economics, and business professors
- The second group of 38 law, economics, and business professors
- The United States also filed an amicus brief, though it was not directly in support of either party.