Apple referred for possible criminal contempt investigation

A US district judge has found Apple wilfully violated her injunction in a case brought by Epic Games — and that a top Apple executive “outright lied” under oath.

The injunction was supposed to block Apple from anticompetitive conduct and pricing, opening the App Store up to outside payment options.

Judge Yvonne Gonzalez Rogers said she was referring the matter to the US Attorney for Northern District of California to investigate whether a criminal contempt proceeding is appropriate.

Apple responded to the ruling late Wednesday.

“We strongly disagree with the decision. We will comply with the court’s order and we will appeal,” an Apple spokesperson said.

Wednesday’s judgement refers to a 2021 case brought by Epic Games, the maker of Fortnite, one of the world’s most popular games, which argued that third-party payment options should be available to customers.

It challenged the up-to-30% cut Apple takes from purchases – and argued that the App Store was monopolistic.

In her 2021 judgement, Judge Gonzalez Rogers stated that Apple could no longer prohibit developers linking to their own purchasing mechanisms.

As well as game purchasing, another example of how this would work is a movie-streaming service being able to tell customers to subscribe via its own website, without using Apple’s in-app purchasing mechanism.

In a contempt order issued Wednesday, Judge Gonzalez Rogers found that Apple nevertheless continued to interfere with competition with attempts that the court stated “will not be tolerated”.

Judge Gonzalez Rogers added that internal company documents she reviewed showed Apple deliberately violated the injunction.

The documents reveal “that Apple knew exactly what it was doing and at every turn chose the most anticompetitive option,” she wrote.

She said CEO Tim Cook ignored executive Phillip Schiller’s urging to have Apple comply with the injunction and allowed CFO Luca Maestri to convince him not to.

“Cook chose poorly,” she wrote.

She also said Apple’s vice president of finance Alex Roman “outright lied under oath”.

The judge wrote that one example of Apple’s attempts to evade the injunction included a decision to charge a 27% commission on off-app purchases. where it had previously charged nothing.

The company also imposed new barriers and requirements to discourage customers from using competing purchasing platforms, she said.

In a post on X, Epic Games founder and CEO Tim Sweeney said Epic Games would return Fortnite to the US iOS App Store next week and offered an olive branch to his long-time rival.

“Epic puts forth a peace proposal: If Apple extends the court’s friction-free, Apple-tax-free framework worldwide, we’ll return ‘Fortnite’ to the App Store worldwide and drop current and future litigation on the topic,” Sweeney wrote.

In another post, he wrote: “NO FEES on web transactions. Game over for the Apple Tax. Apple’s 15-30% junk fees are now just as dead here in the United States of America as they are in Europe under the Digital Markets Act. Unlawful here, unlawful there.”