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    Apple Heading to Court for Something Found on Every iPhone

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    SAN FRANCISCO (AP) —  In a high-stakes antitrust dispute over whether the virtual wall enclosing the iPhone’s app store improperly enriches the most valuable corporation in the world while restricting competition, Apple is set to square off in court with the maker of the popular Fortnite video game.

    The Ninth Circuit Court of Appeals heard oral arguments on Monday from three judges in the latest round of the legal conflict involving an app store that supports more than 1 billion iPhones and is a cornerstone of Apple’s $2.4 trillion business empire.

    It’s an issue that won’t be resolved for a very long time. The appeals court isn’t anticipated to make a decision for another six to twelve months after hearing the arguments on Monday in San Francisco. Because the matter is so crucial to both businesses, the losing party is likely to appeal the case to the US Supreme Court, which might drag on into 2024 or 2025.

    The dispute started in August 2020 when Fortnite creator Epic Games filed an antitrust suit in an effort to tear down the barriers that have given Apple sole control over the iPhone app market since the shop’s establishment 14 years prior.

    Apple has been able to enforce commissions that give it a 15%–30% cut of purchases made for digital services offered by other businesses thanks to its unrivaled control over the app store. According to some estimates, these commissions bring in $15 billion to $20 billion for Apple every year. The Cupertino, California-based corporation claims that this money goes toward paying for the iPhone’s hardware as well as the store’s almost 2 million primarily free apps.

    In a 185-page decision handed down 13 months ago, U.S. District Judge Barbara Gonzalez Rogers concurred almost exclusively with Apple. That came after a carefully observed trial in which key executives like Tim Cook, CEO of Apple, and Sweeney, CEO of Epic, testified.

    Gonzalez Rogers exposed a gap that Apple wants to fix notwithstanding her declaration that Apple’s monopoly over iPhone apps isn’t one. The judge ordered Apple to comply with the requirement, but until the appeals court determines, has postponed it. The judge ordered Apple to permit apps to provide links to payment options outside the app store.

    Epic’s attorney Thomas Goldstein is anticipated to begin Monday’s arguments by attempting to convince the three judges Sidney R. Thomas, Milan D. Smith Jr., and Michael J. McShane that Gonzalez Rogers should have treated the iPhone app store and the transaction system as two distinct markets rather than bundling them together.

    More on this story via The Western Journal:

    A lawyer for the Justice Department will also get a chance to explain why the agency believes Gonzalez Rogers interpreted the federal antitrust law too narrowly, jeopardizing future enforcement actions against potentially anti-competitive behavior in the technology industry. Although the department technically isn’t taking sides, its arguments are expected to help Epic make its case that the appeals court should overturn the lower court decision.

    Another lawyer for the California Attorney General’s office will present arguments defending the law that Gonzalez Rogers cited in ordering Apple to provide links to alternative ways to pay outside its app store.

    Apple lawyer Mark Perry will get the chance to make the final arguments, giving him an opportunity to tailor a presentation aimed at answering some of the questions that the judges may ask the lawyers preceding him. CONTINUE READING…

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