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U.S. judge in ‘Fortnite’ case strikes down Apple’s in-app payment restrictions

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September 10, 2021

By Stephen Nellis

(Reuters) -A U.S. judge on Friday issued a ruling in “Fortnite” creator Epic Games’ antitrust lawsuit against Apple Inc’s App Store, striking down some of Apple’s restrictions on how developers can collect payments in apps.

The ruling says that Apple cannot bar developers from providing buttons or links in their apps that direct customers to other ways to pay outside of Apple’s own in-app purchase system, which charges developers commissions of up to 30%. The ruling also said that Apple cannot ban developers from communicating with customers via contact information that the developers obtained when customers signed up within the app.

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The ruling comes after a three-week trial in May before Judge Yvonne Gonzalez Rogers of the U.S. District Court for the Northern District of California. Apple shares moved down about 2.5% on news of the decision.

The decision strikes down a core part of Apple’s App Store rules, which prohibit developers from telling users about other places they can go to pay the developer directly rather than using Apple’s payment mechanisms. Gonzalez Rogers issued a nationwide order that allows developers to put into their apps “buttons, external links, or other calls to action that direct customers to purchasing mechanisms.”

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But Gonzalez Rogers stopped short of granting Epic some of its other wishes, such as forcing Apple to open the iPhone up to third-party app stores.

The judge ruled Epic failed to demonstrate Apple is an illegal monopolist, but did show the smartphone giant engaged in “anticompetitive conduct” under California laws.

The judge issued a nationwide injunction blocking Apple “anti-steering provisions” — rules that limit app developers from pointing users outside of Apple’s ecosystem.

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The judge said these rules “hide critical information from consumers and illegally stifle consumer choice.”

(Reporting by Nivedita Balu in Bengaluru, Stephen Nellis in San Francisco and Jan Wolfe in New YorkEditing by Anil D’Silva, Patrick Graham and Matthew Lewis)

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