11 ms·

Epic vs. Apple: Order Granting in Part and Denying in Part Motion for TRO [pdf]

65 points by devemanc 6y ago

devemanc 6y ago
Related case: https://www.courtlistener.com/docket/15721902/cameron-v-apple-inc/ https://www.courtlistener.com/docket/15721902/cameron-v-appl... -- please use the RECAP browser extension if you access any of these filings ( https://free.law/recap/ https://free.law/recap/ )
garmaine 6y ago
TL;DR: Apple is prevented from revoking Epic’s developer credentials, as they have threatened to do, at least until this plays out in court. Fortnite is still off the App Store for the duration. A schedule is outline for next steps in the legal case.
CobrastanJorji 6y ago
Ooph. I'm betting that Epic was expecting to get to stay on the app store during the trial. That's an expensive difference. I would guess that Epic will retract its change and ask to be relisted on the app store (and if that doesn't happen, seek rapid redress in the court, since this TRO decision explicitly lists Epic's ability to be reinstated as a rationale for why there is no risk of irrevocable harm).
- modeless 6y ago
  I'd take that bet. I think Epic (Tim Sweeney, really) was prepared to lose that revenue to win the war. This ruling is what I expected and seems quite reasonable. Epic doesn't get temporary special privileges to break App Store rules (even though they are alleged to be illegal), but also Apple can't retaliate against them in other areas. If Epic does reverse the payment changes in an attempt to return Fortnite to the App Store until the lawsuit is resolved, I doubt Apple will let them back in unless forced by the court (despite Tim Cook's "Sir, we do not retaliate or bully people").
  - threeseed 6y ago
    People seem to act like this is the first App Store dispute. There have been many over the last decade and Apple's behaviour has been consistent i.e. they will simply allow Epic to come back onto the store and pretend like nothing ever happened. Exactly like we saw recently with the Hey app. Apple doesn't want to punish developers but they will play hard ball if they don't abide by the rules.
    - fxtentacle 6y ago
      This appears to be the first dispute where Apple aggressively retaliated in unrelated areas of business.
      - philliphaydon 6y ago
        > This appears to be the first dispute where Apple aggressively retaliated in unrelated areas of business. But it's also the first publish dispute where someone purposely put in code to activate alternative payment options and broke the rules. Apple is setting an example of epic. Don't break the rules.
        modeless 6y ago
        No it's not https://techcrunch.com/2018/08/21/netflix-itunes-2/ https://techcrunch.com/2018/08/21/netflix-itunes-2/
        philliphaydon 6y ago
        Yes it is, Netflix didn't hide code and then later enable it to support another payment option inside their app. They tried to redirect users to a website when signing up for premium. What Epic did was hide code and later enable the feature.
        modeless 6y ago
        Netflix hid code and later enabled it to redirect users to a non-Apple payment method. Epic hid code and later enabled it to redirect users to a non-Apple payment method. They did the exact same thing.
- dogma1138 6y ago
  I don’t think Epic is making that much money from Fortnite on iOS to actually care, I think they are using Apple because a) its an easy target and if they win the ruling can be expanded to other platforms too where they currently make the most money on and b) while they aren’t a major source of revenue now Epic probably has bigger plans for mobile centric games down the line. Basically now it’s the best time for them to do it, Apple is a huge target and they can gain industry support, Fortnite is big enough that even the average judge, jurist and jury member is likely aware of it and right now they stand to lose very little financially from not being on iOS while the potential future gains are insane.
  - CobrastanJorji 6y ago
    It's possible that revenue has fallen off, but it appears that Fortnite Mobile revenue has been at least $500 million per year. If this trial goes on for two years, that's potentially a billion dollars in lost revenue. https://sensortower.com/blog/fortnite-mobile-revenue-1-billion https://sensortower.com/blog/fortnite-mobile-revenue-1-billi...
    - imtringued 6y ago
      Assuming they introduce the epic store and cut fees from 30% to 0% fees. It would take 6 years to pay the lost revenue back. It's entirely possible that the next hot thing will come out in 6 years and replace Fortnite.
    - reissbaker 6y ago
      Epic makes over $5B/year — and more than $680 million of that is from the Epic Game Store [1], which has always been banned from iOS due to Apple's policies against alternative stores. Fortnite Mobile makes them good money, but it's not their cash cow — and if they can trade a temporary ban on Fortnite for their store running on iOS, it seems like they'll take it. 1: https://www.forbes.com/sites/mattperez/2020/01/14/epic-games-store-has-hit-680-million-in-revenue-108-million-customers/ https://www.forbes.com/sites/mattperez/2020/01/14/epic-games...
    - dogma1138 6y ago
nouveaux 6y ago
Key quotes: "the Court observes that Epic Games strategically chose to breach its agreements with Apple which changed the status quo" "However the showing is not sufficient to conclude that these considerations outweigh the general public interest in requiring private parties to adhere to their contractual agreements or in resolving business disputes through normal, albeit expedited, proceedings." "Epic Games and Apple are at liberty to litigate against each other, but their dispute should not create havoc to bystanders."
tdrp 6y ago
It seems some of the decision hinged around this fact from the article: "self-inflicted wounds are not irreparable injury". I wonder if there could have been a better sequence of events (e.g. sue first rather than sneaking it in)?
- modeless 6y ago
  I don't think that would have changed anything. The court still wouldn't have granted Epic special permission to break App Store rules before the lawsuit is resolved. Epic isn't in a worse position for trying it. Unless Apple refuses to let them back in after reversing the payment changes, in retaliation for filing a lawsuit. In which case I think the court should intervene.
square_usual 6y ago
I'm pretty sure this is the outcome Epic was expecting.My impression is that they don't want their stunts to affect the developers using Unreal Engine, but they're OK with Fortnite being off the App Store if they can win a concession for things like a smaller cut or even getting their EGS onto iOS.
supernova87a 6y ago
Some choice sections: "...On Thursday, August 13, 2020, Epic Games made the calculated decision to breach its allegedly illegal agreements with Apple by activating allegedly hidden code in Fortnite allowing Epic Games to collect IAPs directly. In response, Apple removed Fortnite from the App Store, where it remains unavailable to the date of this Order. Later that same day, Epic Games filed this action and began a pre-planned, and blistering, marketing campaign against Apple... " "...The Court finds that with respect to Epic Games’ motion as to its games, including Fortnite, Epic Games has not yet demonstrated irreparable harm. The current predicament appears of its own making... Epic Games admits that the technology exists to “fix” the problem easily by deactivating the “hotfix.” That Epic Games would prefer not to litigate in that context does not mean that “irreparable harm” exists..." "...Epic Games moves this Court to allow it to access Apple’s platform for free while it makes money on each purchase made on the same platform. While the Court anticipates experts will opine that Apple’s 30 percent take is anti-competitive, the Court doubts that an expert would suggest a zero percent alternative. Not even Epic Games gives away its products for free..." Ouch. Separately, the aspect of Apple pulling keys for the developer (e.g. Unreal Engine) platform access was granted a preliminary injunction. Which seems reasonable. I guess Epic has a couple days to decide whether to give in or not: "Fortnite’s next season starts on Thursday, August 27, 2020, and will require an update of the game to play."
- trumpeta 6y ago
  "...Epic Games moves this Court to allow it to access Apple’s platform for free while it makes money on each purchase made on the same platform. While the Court anticipates experts will opine that Apple’s 30 percent take is anti-competitive, the Court doubts that an expert would suggest a zero percent alternative. Not even Epic Games gives away its products for free..." Apple is arguing as if accessing their platform for free was a crime. This makes sense, since they have costs associated with reviews, code signing and distribution. But that is of their own making. Walled gardens should be outlawed.
  - ben_w 6y ago
    It being a walled garden is the only way I’m willing to trust it for accessing all my account recovery emails, my 2FA SMSes, my bank details, and the sensor package that can listen to everything I do while GPS tracking me and monitoring my heart rate and gaze if I happen to be holding it where I can see the screen. Of course, that doesn’t mean I like being stuck with an American cultural hegemony that says sexual content is forbidden, or that needs an encryption export licence from the USA government for apps written by non-Americans for non-Americans, and which still demands annual reporting to the US government for using https. I’m happy with any walls that meet basic security standards, but I do want a wall, even if it would be nice to choose which wall.
IceWreck 6y ago
This seems fair. Although Epic should separate its Unreal business from Fortnite to avoid these in the future.
- threeseed 6y ago
  You have to remember Epic has planned this all pretty carefully from the start. They benefit from being able to play the "if you ban us, you also ban all of the little mom & pop game developers" sympathy card.
  - ben_w 6y ago
    That sounds like Epic abusing its “monopoly”[0] on game engines. [0] in the same sense that Apple is a monopoly on smartphones, hence the air-quotes.
- InGoodFaith 6y ago
  It's already separately under Epic Games International, S.a.r.l (“Epic International”). It was under a different agreement from the regular "Epic Games" that Apple decided to both terminate
reissbaker 6y ago
This seems like the predictable outcome. Epic knew Fortnite would get banned when they started this; Apple is innocent until proven guilty, so no court will force Apple to reinstate Fortnite unless Epic wins its antitrust suit. But similarly, Apple's subsequent, second threat to ban Epic from doing other lines of business via macOS tools (e.g. Unreal Engine development) seemed excessive compared to other app bans, and seemed clearly an attempt to use their power to shake down Unreal customers as retaliation for the dispute. I'm not surprised that Epic started this: they want their game store on iOS, and the only way that happens is via an antitrust lawsuit — and you can't bring an antitrust lawsuit unless you show evidence of harm (aka, lost Fortnite sales). Epic wanted Fortnite to be banned so that they could sue Apple. I'm curious why Apple escalated, though. It seemed to me like they were playing into Epic's hand: they're currently under multiple antitrust investigations by the US and the EU, and using their market power on iOS to corral developers on macOS seems like a pretty obvious violation, and a novel one: when they banned XCloud from iOS, for example, they didn't also ban MS Office from running on Macs. Why would they try to do it now? When I first saw it I wondered if Apple knew something we didn't (since Epic would pretty obviously attempt to contest this in court), and that Apple was playing its own 4D chess game against Epic, secure in the knowledge that the court wouldn't grant the injunction on the macOS tools. But... Now it just looks like a fit of pique? Apple had already banned Fortnite when it issued the second threat to ban Unreal; the second threat ended with them getting nothing (the court prevented them from following through) and left looking like monopolists during the antitrust investigations. I don't get it.
- Hamuko 6y ago
  >you can't bring an antitrust lawsuit unless you show evidence of harm (aka, lost Fortnite sales) I thought the point of antitrust is that it brings harm to the consumers and not just some lesser company?
  - modeless 6y ago
    The harm to consumers is the higher price that they have to pay. Epic didn't just keep the 30% all for themselves, they lowered prices.
swarnie_ 6y ago
Does anyone find this whole situation very anti-consumer? Two billion dollar tech companies have started a slap fight, both have claimed its for the benefit of their customers/users but in reality its about their own personal bottom line. The gaming forums filling up with pre-teen twits willing to cheer lead for their respective megacorp is thoroughly depressing to look at.
bwilli123 6y ago
..."What was striking about all of these apps is that only three of them functioned primarily on an iPhone; in the vast majority of cases Apple was demanding in-app purchase offerings for functionality that was largely not dependent on an iPhone:" https://stratechery.com/2020/rethinking-the-app-store/ https://stratechery.com/2020/rethinking-the-app-store/
terpimost 6y ago
Not sure if somebody did that bet. So I just put it here. I think the best outcome could be when Apple be forced to allow bigger number of devices under TestFlight - which is the way to install apps not from AppStore. Apple would probably charge extra for that like $1 per device. No virtual goods outside of apple payment system, same 30%.
- StavrosK 6y ago
  The best outcome would be for Apple to allow alternate stores into iOS, like Cydia.

65 points by devemanc 6y ago

Related case: https://www.courtlistener.com/docket/15721902/cameron-v-apple-inc/ https://www.courtlistener.com/docket/15721902/cameron-v-appl... -- please use the RECAP browser extension if you access any of these filings ( https://free.law/recap/ https://free.law/recap/ )

garmaine 6y ago

TL;DR: Apple is prevented from revoking Epic’s developer credentials, as they have threatened to do, at least until this plays out in court. Fortnite is still off the App Store for the duration. A schedule is outline for next steps in the legal case.

CobrastanJorji 6y ago

Ooph. I'm betting that Epic was expecting to get to stay on the app store during the trial. That's an expensive difference. I would guess that Epic will retract its change and ask to be relisted on the app store (and if that doesn't happen, seek rapid redress in the court, since this TRO decision explicitly lists Epic's ability to be reinstated as a rationale for why there is no risk of irrevocable harm).

modeless 6y ago
I'd take that bet. I think Epic (Tim Sweeney, really) was prepared to lose that revenue to win the war. This ruling is what I expected and seems quite reasonable. Epic doesn't get temporary special privileges to break App Store rules (even though they are alleged to be illegal), but also Apple can't retaliate against them in other areas. If Epic does reverse the payment changes in an attempt to return Fortnite to the App Store until the lawsuit is resolved, I doubt Apple will let them back in unless forced by the court (despite Tim Cook's "Sir, we do not retaliate or bully people").
- threeseed 6y ago
  People seem to act like this is the first App Store dispute. There have been many over the last decade and Apple's behaviour has been consistent i.e. they will simply allow Epic to come back onto the store and pretend like nothing ever happened. Exactly like we saw recently with the Hey app. Apple doesn't want to punish developers but they will play hard ball if they don't abide by the rules.
  - fxtentacle 6y ago
    This appears to be the first dispute where Apple aggressively retaliated in unrelated areas of business.
    - philliphaydon 6y ago
      > This appears to be the first dispute where Apple aggressively retaliated in unrelated areas of business. But it's also the first publish dispute where someone purposely put in code to activate alternative payment options and broke the rules. Apple is setting an example of epic. Don't break the rules.
      - modeless 6y ago
        No it's not https://techcrunch.com/2018/08/21/netflix-itunes-2/ https://techcrunch.com/2018/08/21/netflix-itunes-2/
        philliphaydon 6y ago
        Yes it is, Netflix didn't hide code and then later enable it to support another payment option inside their app. They tried to redirect users to a website when signing up for premium. What Epic did was hide code and later enable the feature.
        modeless 6y ago
        Netflix hid code and later enabled it to redirect users to a non-Apple payment method. Epic hid code and later enabled it to redirect users to a non-Apple payment method. They did the exact same thing.
dogma1138 6y ago
I don’t think Epic is making that much money from Fortnite on iOS to actually care, I think they are using Apple because a) its an easy target and if they win the ruling can be expanded to other platforms too where they currently make the most money on and b) while they aren’t a major source of revenue now Epic probably has bigger plans for mobile centric games down the line. Basically now it’s the best time for them to do it, Apple is a huge target and they can gain industry support, Fortnite is big enough that even the average judge, jurist and jury member is likely aware of it and right now they stand to lose very little financially from not being on iOS while the potential future gains are insane.
- CobrastanJorji 6y ago
  It's possible that revenue has fallen off, but it appears that Fortnite Mobile revenue has been at least $500 million per year. If this trial goes on for two years, that's potentially a billion dollars in lost revenue. https://sensortower.com/blog/fortnite-mobile-revenue-1-billion https://sensortower.com/blog/fortnite-mobile-revenue-1-billi...
  - imtringued 6y ago
    Assuming they introduce the epic store and cut fees from 30% to 0% fees. It would take 6 years to pay the lost revenue back. It's entirely possible that the next hot thing will come out in 6 years and replace Fortnite.
  - reissbaker 6y ago
    Epic makes over $5B/year — and more than $680 million of that is from the Epic Game Store [1], which has always been banned from iOS due to Apple's policies against alternative stores. Fortnite Mobile makes them good money, but it's not their cash cow — and if they can trade a temporary ban on Fortnite for their store running on iOS, it seems like they'll take it. 1: https://www.forbes.com/sites/mattperez/2020/01/14/epic-games-store-has-hit-680-million-in-revenue-108-million-customers/ https://www.forbes.com/sites/mattperez/2020/01/14/epic-games...
  - dogma1138 6y ago

nouveaux 6y ago

Key quotes: "the Court observes that Epic Games strategically chose to breach its agreements with Apple which changed the status quo" "However the showing is not sufficient to conclude that these considerations outweigh the general public interest in requiring private parties to adhere to their contractual agreements or in resolving business disputes through normal, albeit expedited, proceedings." "Epic Games and Apple are at liberty to litigate against each other, but their dispute should not create havoc to bystanders."

tdrp 6y ago

It seems some of the decision hinged around this fact from the article: "self-inflicted wounds are not irreparable injury". I wonder if there could have been a better sequence of events (e.g. sue first rather than sneaking it in)?

modeless 6y ago
I don't think that would have changed anything. The court still wouldn't have granted Epic special permission to break App Store rules before the lawsuit is resolved. Epic isn't in a worse position for trying it. Unless Apple refuses to let them back in after reversing the payment changes, in retaliation for filing a lawsuit. In which case I think the court should intervene.

square_usual 6y ago

I'm pretty sure this is the outcome Epic was expecting.My impression is that they don't want their stunts to affect the developers using Unreal Engine, but they're OK with Fortnite being off the App Store if they can win a concession for things like a smaller cut or even getting their EGS onto iOS.

supernova87a 6y ago

Some choice sections: "...On Thursday, August 13, 2020, Epic Games made the calculated decision to breach its allegedly illegal agreements with Apple by activating allegedly hidden code in Fortnite allowing Epic Games to collect IAPs directly. In response, Apple removed Fortnite from the App Store, where it remains unavailable to the date of this Order. Later that same day, Epic Games filed this action and began a pre-planned, and blistering, marketing campaign against Apple... " "...The Court finds that with respect to Epic Games’ motion as to its games, including Fortnite, Epic Games has not yet demonstrated irreparable harm. The current predicament appears of its own making... Epic Games admits that the technology exists to “fix” the problem easily by deactivating the “hotfix.” That Epic Games would prefer not to litigate in that context does not mean that “irreparable harm” exists..." "...Epic Games moves this Court to allow it to access Apple’s platform for free while it makes money on each purchase made on the same platform. While the Court anticipates experts will opine that Apple’s 30 percent take is anti-competitive, the Court doubts that an expert would suggest a zero percent alternative. Not even Epic Games gives away its products for free..." Ouch. Separately, the aspect of Apple pulling keys for the developer (e.g. Unreal Engine) platform access was granted a preliminary injunction. Which seems reasonable. I guess Epic has a couple days to decide whether to give in or not: "Fortnite’s next season starts on Thursday, August 27, 2020, and will require an update of the game to play."

trumpeta 6y ago
"...Epic Games moves this Court to allow it to access Apple’s platform for free while it makes money on each purchase made on the same platform. While the Court anticipates experts will opine that Apple’s 30 percent take is anti-competitive, the Court doubts that an expert would suggest a zero percent alternative. Not even Epic Games gives away its products for free..." Apple is arguing as if accessing their platform for free was a crime. This makes sense, since they have costs associated with reviews, code signing and distribution. But that is of their own making. Walled gardens should be outlawed.
- ben_w 6y ago
  It being a walled garden is the only way I’m willing to trust it for accessing all my account recovery emails, my 2FA SMSes, my bank details, and the sensor package that can listen to everything I do while GPS tracking me and monitoring my heart rate and gaze if I happen to be holding it where I can see the screen. Of course, that doesn’t mean I like being stuck with an American cultural hegemony that says sexual content is forbidden, or that needs an encryption export licence from the USA government for apps written by non-Americans for non-Americans, and which still demands annual reporting to the US government for using https. I’m happy with any walls that meet basic security standards, but I do want a wall, even if it would be nice to choose which wall.

IceWreck 6y ago

This seems fair. Although Epic should separate its Unreal business from Fortnite to avoid these in the future.

threeseed 6y ago
You have to remember Epic has planned this all pretty carefully from the start. They benefit from being able to play the "if you ban us, you also ban all of the little mom & pop game developers" sympathy card.
- ben_w 6y ago
  That sounds like Epic abusing its “monopoly”[0] on game engines. [0] in the same sense that Apple is a monopoly on smartphones, hence the air-quotes.
InGoodFaith 6y ago
It's already separately under Epic Games International, S.a.r.l (“Epic International”). It was under a different agreement from the regular "Epic Games" that Apple decided to both terminate

reissbaker 6y ago

This seems like the predictable outcome. Epic knew Fortnite would get banned when they started this; Apple is innocent until proven guilty, so no court will force Apple to reinstate Fortnite unless Epic wins its antitrust suit. But similarly, Apple's subsequent, second threat to ban Epic from doing other lines of business via macOS tools (e.g. Unreal Engine development) seemed excessive compared to other app bans, and seemed clearly an attempt to use their power to shake down Unreal customers as retaliation for the dispute. I'm not surprised that Epic started this: they want their game store on iOS, and the only way that happens is via an antitrust lawsuit — and you can't bring an antitrust lawsuit unless you show evidence of harm (aka, lost Fortnite sales). Epic wanted Fortnite to be banned so that they could sue Apple. I'm curious why Apple escalated, though. It seemed to me like they were playing into Epic's hand: they're currently under multiple antitrust investigations by the US and the EU, and using their market power on iOS to corral developers on macOS seems like a pretty obvious violation, and a novel one: when they banned XCloud from iOS, for example, they didn't also ban MS Office from running on Macs. Why would they try to do it now? When I first saw it I wondered if Apple knew something we didn't (since Epic would pretty obviously attempt to contest this in court), and that Apple was playing its own 4D chess game against Epic, secure in the knowledge that the court wouldn't grant the injunction on the macOS tools. But... Now it just looks like a fit of pique? Apple had already banned Fortnite when it issued the second threat to ban Unreal; the second threat ended with them getting nothing (the court prevented them from following through) and left looking like monopolists during the antitrust investigations. I don't get it.

Hamuko 6y ago
>you can't bring an antitrust lawsuit unless you show evidence of harm (aka, lost Fortnite sales) I thought the point of antitrust is that it brings harm to the consumers and not just some lesser company?
- modeless 6y ago
  The harm to consumers is the higher price that they have to pay. Epic didn't just keep the 30% all for themselves, they lowered prices.

swarnie_ 6y ago

Does anyone find this whole situation very anti-consumer? Two billion dollar tech companies have started a slap fight, both have claimed its for the benefit of their customers/users but in reality its about their own personal bottom line. The gaming forums filling up with pre-teen twits willing to cheer lead for their respective megacorp is thoroughly depressing to look at.

bwilli123 6y ago

..."What was striking about all of these apps is that only three of them functioned primarily on an iPhone; in the vast majority of cases Apple was demanding in-app purchase offerings for functionality that was largely not dependent on an iPhone:" https://stratechery.com/2020/rethinking-the-app-store/ https://stratechery.com/2020/rethinking-the-app-store/

terpimost 6y ago

Not sure if somebody did that bet. So I just put it here. I think the best outcome could be when Apple be forced to allow bigger number of devices under TestFlight - which is the way to install apps not from AppStore. Apple would probably charge extra for that like $1 per device. No virtual goods outside of apple payment system, same 30%.

StavrosK 6y ago
The best outcome would be for Apple to allow alternate stores into iOS, like Cydia.