Apple Faces Criminal Contempt Investigation Over Epic Games Case

The ruling marks a significant escalation in a legal battle with Epic Games, as Apple is referred for possible criminal contempt over alleged deceit and competitive malpractices.

In an alarming development for Apple, a US district judge has determined that the tech giant has willfully violated a court injunction resulting from a case initiated by Epic Games, the developer behind the popular Fortnite game. Judge Yvonne Gonzalez Rogers accused a senior Apple executive of "outright lying" under oath during the proceedings, leading her to refer the issue to the US Attorney for the Northern District of California for potential criminal contempt investigations.

Apple's legal troubles trace back to a 2021 lawsuit filed by Epic Games, which argued that the company maintained monopolistic control over its App Store by limiting developers to its in-app purchasing system, where it often takes a cut of up to 30%. Judge Gonzalez Rogers previously ruled that Apple could not prohibit developers from directing users to alternate payment methods. This injunction was intended to foster a fairer market environment by allowing users the option to pay outside the Apple ecosystem.

However, in a contempt order issued confirmed on Wednesday, Judge Gonzalez Rogers accused Apple of continued efforts to stifle competition. She stated that internal documents suggested Apple was fully aware of its actions, which she characterized as deliberately anticompetitive, and that Apple executives, including CEO Tim Cook, ignored advice to adhere to the injunction. The judge highlighted a case where Apple introduced a 27% commission on off-app purchases, in stark contrast to its previous zero-fee policy, along with new measures to deter customers from using competing platforms.

In response to the ruling, an Apple spokesperson expressed strong disagreement and indicated the company's intent to appeal the decision. Meanwhile, Epic Games founder Tim Sweeney announced plans to reintroduce Fortnite to the iOS App Store, suggesting a truce with Apple if the company complies with the court's mandate globally and eliminates additional fees on web transactions. Sweeney labeled Apple's past transaction fees as "junk" and claims their anticompetitive practices are likewise becoming unlawful across multiple jurisdictions.