Epic Games wins appeal to recommence app store competition lawsuit against Apple
The Australian Federal Court has granted an appeal submitted by Epic Games that will allow the games developer to go ahead with its legal fight against Apple down under.
On Friday morning, three Federal court judges granted Epic Games’ appeal, which had sought to recommence a lawsuit that accuses Apple of misusing its market power to substantially lessen competition in the app distribution and payments market.
Epic Games said it was pleased with the outcome and would continue to fight for increased competition in this space.
“This is a positive step forward for Australian consumers and developers who are entitled to fair access and competitive pricing across mobile app stores. We look forward to continuing our fight for increased competition in app distribution and payment processing in Australia and around the world,” Epic Games said.
The appeal arose in April after a lawsuit, accusing Apple of misusing its market power, was put on hold due to the presiding judge, Justice Nye Perram, believing the lawsuit was bound by exclusive jurisdiction clauses. The exclusive jurisdiction clauses block certain Australian lawsuits from going ahead if a similar matter is being heard in another country.
When making that decision, Perram explained at the time he wanted to first see the outcome of a similar lawsuit being heard in the US before continuing with the Australian case.
During the appellate hearing, however, three Federal Court judges found that Perram erred in granting a stay of the lawsuit as it involves fundamental public interest issues in relation to conduct undertaken in an Australian sub-market and involves an Australian company that is not itself a party to the exclusive jurisdiction clause.
The judges explained that exploring the public interest issues at hand took priority over the exclusive jurisdiction clauses that were originally enforced by Perram.
When making that decision, the judges took submissions from the Australian Competition and Consumer Commission, which took part in the hearing as a non-party due to its role of being the statutory agency responsible for administering Australia’s competition law.
The judges added that only limiting Epic Games to litigating these proceedings in the US would deprive the company of a legitimate forensic advantage that could be presented through Australian laws.
“The focus should not only be on the nature of competition law, but the significance of the statutory provisions which allow the Commission to intervene, private parties to get the benefit of factual findings and admission, and the relevance of the Federal Court being chosen by the legislature as the court of its choice,” the judges wrote.
With the case now set to recommence, both parties will meet again in court later this month for a case management hearing.
The legal spat between the companies arose last year when Epic implemented an in-app payment system within Fortnite to circumvent paying a 30% commission fee to app marketplaces, such as the App Store and Google Play Store.
This led to Apple and Google both removing Fortnite from their respective marketplaces, citing that Epic breached its contractual obligations for residing in these app marketplaces.
Epic then clapped back by filing lawsuits against Apple and Google in the US, accusing the tech giants of conducting anti-competitive and monopolistic practices due to their 30% commission fee structures.
After those original lawsuits, Epic Games then raised additional lawsuits across various jurisdictions — including in Australia, the EU, and UK — that all raise similar allegations.