Epic largely lost to Apple, but 35 states are now backing its fight in a higher court

Epic Games may have largely lost its major lawsuit against Apple, but it’s not going out without a fight — and it has some major support in its corner. Soon after the Epic Games v. Apple ruling was issued, Epic appealed, and over the past two days, a large number of organizations have filed amicus briefs in support of Epic’s battle, including a coalition of 35 state attorneys general, Microsoft, and the Electronic Frontier Foundation (EFF). (The original ruling has since been put on hold after an appeals court granted a stay.)

During the fight, Epic was trying to make the case that Apple has a monopoly in mobile gaming with the App Store, and in so doing, force Apple to take a smaller percentage of all the transactions that go through that store. If it were successful in pushing Apple to accept alternate payment processors, it could dramatically change how Apple, the most profitable company in the world, operates its highly lucrative App Store. In the original case, the judge ultimately ruled in favor of Apple in nine of ten counts Epic brought against it, but both Epic and Apple appealed the parts that they lost.

In an opening appeal brief filed last week, Epic argued that letting the ruling stand “would upend established principles of antitrust law and…undermine sound antitrust policy.”

Now, it seems more than half the states in the US, Microsoft, and the many more groups filing amicus briefs (which are filed by someone who is not a party in the case, adding 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 supracompetitive 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. We’ve uploaded each of their briefs to DocumentCloud so you can read them for yourself:

The United States also filed an amicus brief, though its was not in support of either party.

https://www.theverge.com/2022/1/28/22907106/epic-games-v-apple-amicus-briefs-states-eff-microsoft-appeal