Apple Counter-sues Fortnite’s Epic Games

LegalMobile AppsMobilityRegulation

The Empire strikes back. Apple seeks damages from Epic Games for stealing commission charges, as it launches counter lawsuit

The bad blood between Epic Games and Apple continues, with the news that the iPad maker has launched a counter lawsuit against the creator of Fortnite.

In its lawsuit, Apple accused Epic Games of stealing the 30 percent commissions the iPhone maker takes from app developers.

Indeed, in its court filing, Apple also accused Epic of “self-help and subterfuge” and conducting a “sneak attack” on Apple, as part of its alleged “commission-theft”.

Credit: Epic Games

Sneak attack

Apple is seeking monetary damages from Epic Games and alleged that the game developer engaged in underhand business practices.

“Epic’s lawsuit is nothing more than a basic disagreement over money,” said Apple in its counter lawsuit. “Although Epic portrays itself as a modern corporate Robin Hood, in reality it is a multi-billion dollar enterprise that simply wants to pay nothing for the tremendous value it derives from the App Store.”

“Epic’s demands for special treatment and cries of ‘retaliation’ cannot be reconciled with its flagrant breach of contract and its own business practices, as it rakes in billions by taking commissions on game developers’ sales and charging consumers up to $99.99 for bundles of ‘V-Bucks’” it said.

Apple’s lawsuit also mentioned the alleged attempt by Epic to pay the same 15 percent commission rate that Amazon Prime pays.

“When Apple rejected Epic’s request for a special deal, rather than abide by its long-running contractual agreements pursuant to which it has earned over $600 million, Epic resorted to self-help and subterfuge,” Apple alleged. “On 3 August, 2020, Epic sent a Trojan horse to the App Store – a new version of Fortnite that included what Epic has euphemistically described as a ‘hotfix’ that allows Epic to bypass Apple’s app review process and ability to collect commissions by directing app users to pay Epic instead, cutting Apple out entirely.”

“Unbeknownst to Apple, Epic had been busy enlisting a legion of lawyers, publicists, and technicians to orchestrate a sneak assault on the App Store. Shortly after 2:00 a.m. On 13 August, 2020, the morning on which Epic would activate its hidden commission-theft functionality, Mr. Sweeney again emailed Apple executives, declaring that “Epic will no longer adhere to Apple’s payment processing restrictions,” Apple alleged.

“Hours after Mr. Sweeney’s 2:00 a.m. email, Epic triggered the ‘hotfix’ it previously planted in Fortnite to push through a new external payment runaround – which Epic had deliberately concealed from Apple’s app review process – that usurped Apple’s commission and brazenly flouted its rules,” Apple alleged. “This was little more than theft. Epic sought to enjoy all of the benefits of Apple’s iOS platform and related services while its ‘hotfix’ lined Epic’s pockets at Apple’s expense.”

“Epic fired the first shot in this dispute, and its willful, brazen, and unlawful conduct cannot be left unchecked,” Apple concluded.

“Neither Mr. Sweeney’s self-righteous (and self-interested) demands nor the scale of Epic’s business can justify Epic’s deliberate contractual breaches, its tortious conduct, or its unfair business practices,” Apple alleged. “This Court should hold Epic to its contractual promises, award Apple compensatory and punitive damages, and enjoin Epic from engaging in further unfair business practices.”

Legal moves

Apple’s counter lawsuit is the latest legal twist in this drama.

It all began on 13 August when Epic Games issued an update for Fortnite that allowed players to purchase in-game currency directly from Epic, bypassing Apple and Google’s payment systems and the 30 percent commission they charge.

Apple and Google then retaliated and removed Fortnite from their respective App Stores, prompting Epic to file a lawsuit against Apple.

But in addition to removing Fortnite, Apple also said it would terminate all of Epic Games’ developer accounts and cut it off from its development tools starting 28 August.

That was going to be an even bigger problem for Epic, because despite developing its own gaming titles, it also makes tools for other game developers such as the Unreal Engine.

Epic then filed an emergency injunction to stop Apple from revoking iOS and macOS support for its Unreal Engine.

Late last month a US court granted part of the injunction and stopped Apple from removing its Unreal Engine from the Apple developer program.

However, the Judge also ruled that Apple won’t be required to make Fortnite available on its App Store.

But Epic Games was not happy, and late last week it filed a fresh legal challenge in the US District Court of Northern California seeking another preliminary injunction against Apple.

Epic Games revealed in its filing that usage of Fortnite on iOS platforms had plummeted by more than 60 percent since Apple remove the game off the App Store.

Read also :
Author: Tom Jowitt
Click to read the authors bio  Click to hide the authors bio