How Epic could actually win its cases against Apple and Google
Lawyers and experts say Epic's lawsuits are surprisingly serious — and the $17 billion gaming company actually has a shot at winning.
The lawsuits from Fortnite maker Epic Games against Apple and Google this week bear all the hallmarks of a PR stunt.
Epic introduced its new payment system with a flourish. And the company was ready with almost 150 pages of legal arguments and an ad campaign to hit back when Apple and Google inevitably removed the app from their stores on Thursday.
But former antitrust regulators and experts say Epic's lawsuits are surprisingly serious, and the $17 billion gaming company actually has a shot at winning.
"This is a really well-put-together lawsuit that they obviously had been planning for quite a while," said Chris Saagers, a professor at Cleveland-Marshall College of Law who has written extensively about antitrust issues around Apple. "They've done their homework."
For one, Epic's cases are backed by multiple superstar attorneys in the antitrust world, including Christine Varney, a former U.S. assistant attorney general within the Justice Department's antitrust division, and Katherine Forrest, who served as the U.S. district judge for the Southern District of New York as well as a deputy in the DOJ antitrust division. (Forrest and Varney now work at Cravath, Swaine & Moore LLP — ironically, the firm that represented IBM, which Apple named as a monopolist when it first launched the App Store.)
Their names alone give the case a boost of credibility, said John Newman, an associate professor of law at the University of Miami and former DOJ antitrust lawyer. "I frankly don't think those types of attorneys take on cases that aren't serious," he said.
The cases also appear to be promising, experts said. Epic is arguing that Apple and Google use their "monopoly" power over their respective app stores to stifle competition and harm rivals, specifically focusing on their policies of taking a 30% cut of all in-app purchases. The argument is reminiscent of landmark tech antitrust case U.S. v. Microsoft, in which Microsoft was found guilty of violating the law.
It's notable that Epic is not seeking any monetary relief. Instead, the company is looking for court orders that would prevent Apple and Google from further engaging in their "anti-competitive conduct" over the app stores.
"Epic is not seeking monetary compensation from this Court for the injuries it has suffered," the company said in its lawsuit against Apple. "Nor is Epic seeking favorable treatment for itself, a single company. Instead, Epic is seeking injunctive relief to allow fair competition in these two key markets that directly affect hundreds of millions of consumers and tens of thousands, if not more, of third-party app developers."
Multiple state attorneys general, Congress and the European Commission are all investigating Apple over its App Store policies, elevating the Apple case's importance and visibility.
But Epic could hit a hurdle with its narrow definition of the markets that Apple and Google monopolize. It's arguing that Apple illegally uses its power over the iOS distribution market and payments system, while Google monopolizes its Android app distribution market. Essentially, Epic is alleging a "single-brand market," which judges typically do not prefer. "Alleging a single-brand market is an uphill battle," said Newman.
There's some precedent for plaintiffs winning cases when they allege single-brand markets, but it will be difficult. The issue is that Apple and Google together dominate the app distribution market in the U.S., making it hard to argue that either has a total monopoly.
The lawyers said it seems like Epic's cases, particularly the case against Apple, have a fair chance of going to trial in Northern California, where they were filed. But that process could take years.
Next, Apple and Google are likely to file motions to dismiss the cases, said Maurice Stucke, a former prosecutor in the Justice Department's antitrust division who now teaches law at the University of Tennessee in Knoxville.
But, Stucke said, the question remains: "Where's our government? Why aren't they bringing these types of cases?"
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