Apple asks Supreme Court to reverse app store ruling won by Epic

Apple Inc. said it has asked the US Supreme Court to review a judge’s ruling from two years ago that could diminish the billions of dollars in revenue its App Store generates by letting app developers direct users to alternative payment methods.

Apple asks US Supreme Court to review app store ruling in battle with Epic Games. (REUTERS)

Apple Inc. said it has asked the US Supreme Court to review a judge's ruling from two years ago that could diminish the billions of dollars in revenue its App Store generates by letting app developers direct users to alternative payment methods.

Apple's request to the high court on Thursday is its latest salvo in a drawn-out battle with Epic Games Inc. over how the iPhone maker runs its app marketplace.

App Store revenue is lucrative for Apple, with developers charged a commission of as much as 30% for sales of digital goods and services — a fee that the maker of the popular Fortnite game is trying to avoid paying. At the same time, years of complaints from app developers and scrutiny from governments globally have already forced Apple to rewrite some of the rules protecting its dominance in the $160 billion app distribution marketplace.

Apple's request comes a day after Epic petitioned the Supreme Court to review a separate part of the ruling, thatApp Store policies don't violate federal antitrust laws. Apple's filing couldn't immediately be confirmed in court records.

The Supreme Court, per its regular schedule, could decide by the end of the year or early next year whether it will take up either or both of the petitions.

In a mixed ruling in September 2021 following a trial, a federal judge in Oakland, California, largely rejected Epic's claims that Apple's online marketplace policies violated federal law by barring third-party app marketplaces on its operating system. But she also found that Apple flouted California state law by blocking developers from letting consumers know about alternative payment methods. The 9th US Circuit Court of Appeals affirmed the trial judge's decision in April.

Apple has been making changes to the way the App Store operates to address developer concerns since Epic sued the company in 2020. The dispute began after Apple expelled the Fortnite game from the App Store because Epic created a workaround to paying the 30% fee on customers' in-app purchases.

Apple now allows developers to “steer” consumers, in some scenarios, to make payments for subscription apps outside of its own system. That means “reader apps” — which encompass apps and services for digital newspapers and magazines, books, audio streaming and video watching — can point users to the web with a button to complete their sign-up.

That addressed a core issue within Epic's lawsuit against Apple, but the current Apple policy doesn't apply to gaming apps. Epic's software remains off of the App Store and Apple devices.