Global tech

Apple just lost its bid to stop Fortnite’s Epic Games suing it in Australia

- July 9, 2021 2 MIN READ
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Photo: AdobeStock
Apple’s attempt to block Epic Games, the company behind the hit video game Fortnite, from suing it in Australia over anti-competitive behaviour has been overturned on appeal by the Federal Court.

Epic has filed anti-competition complaints against Apple in the European Union, UK, US and Australia, complaining about a range of restrictive conditions on the App Store.

Apple was seeking to have the Australian matter thrown out, arguing it belongs exclusively before the US courts.

A three-month stay on proceedings ahead of a similar case in California was granted by Justice Nye Perram, but Epic appealed that decision.

An expedited hearing on the matter went before the full bench of the Federal Court last month, and today Justices Middleton, Jagot and Moshinsky handed down their judgment in favour of Epic Games, overturning the previous stay in proceedings.

In November last year, Epic launched proceedings in the Federal Court alleging that Apple has contravened various provisions of Australia’s Competition and Consumer Act.

The legal fight began after Apple banned Epic from its App store in August last year in a contractual dispute over paying commissions on products purchased in Fortnite and other apps the games maker has on iPhones.

For the last few months, the matter has been caught up in legal wrangling, with Epic appealing the decision to halt proceedings on the grounds that the judge failed to take into account the “overriding” public policy considerations involved. Apple attempted to rebuff that appeal.

Competition regulator the ACCC also sought to be part of the hearing as “a friend of the court” and was granted permission in May, but in today’s judgment, the three-member Appeals Court bench concluded that the regulator’s submission did “not add anything of substance to the submissions of Epic and Apple”.

The Appeals court ruled that: “the primary judge erred in granting a stay in circumstances where there were strong reasons not to do so”.

The court also awarded costs against Apple.

Epic issued a statement saying it was pleased the Federal Court case will proceed under Australian laws.

“We look forward to continuing our fight for increased competition in app distribution and payment processing in Australia and around the world.”

Apple said it planning to appeal the latest decision.

Meanwhile, the world awaits the ruling of Epic’s flagship case in California, following a three-week trial in May, during which Apple execs gave evidence that, despite charging most developers who sell through the App Store a 30% commission, the company doesn’t even know if the App Store, which generated more than US$60 billion in revenue last year, is profitable.

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