Judge slams Apple for defying App Store antitrust order, refers case for criminal contempt probe

Judge slams Apple for defying App Store antitrust order

A federal judge has sharply rebuked Apple for deliberately violating a court order related to its App Store practices and referred the company to federal prosecutors for a criminal contempt investigation—a rare escalation in a long-running antitrust battle with Epic Games.

As reported by The Wall Street Journal, Judge Yvonne Gonzalez Rogers ruled late Wednesday that Apple “wilfully chose not to comply” with her 2021 injunction, which required the iPhone maker to allow developers to direct users to alternative payment options outside the App Store. The judge accused CEO Tim Cook of disregarding internal advice to comply and said Apple’s finance chief Alex Roman “outright lied under oath.”

Apple accused of creating new barriers to skirt court order

The original ruling in 2021 mostly favoured Apple but forced the company to loosen its iron grip on in-app payments by allowing developers to link users to external platforms. In response, Apple imposed a 27% fee on such external transactions—just slightly below the 30% App Store commission—while placing tight restrictions on how and where developers could communicate payment alternatives.

Judge Rogers ruled that Apple’s actions directly undermined the purpose of her injunction. “It did so with the express intent to create new anticompetitive barriers,” she wrote, accusing the company of attempting to preserve its lucrative App Store revenue at the expense of fair competition.

Developers win key battle in long legal war

Epic Games, the developer behind Fortnite, first brought the antitrust lawsuit against Apple in 2020, alleging monopolistic control over the iOS ecosystem. While Apple largely prevailed in the 2021 decision, the ruling did open a narrow pathway for app makers to bypass Apple’s in-app payment system.

Epic CEO Tim Sweeney welcomed Wednesday’s ruling as a turning point: “We’ve been fighting Apple for a long time. It’s a huge victory for developers.”

The judge’s latest order prohibits Apple from charging any fee for purchases completed outside the App Store and from imposing restrictions that discourage developers from steering users to alternative payment platforms.

Regulatory ripple effects could follow

The harsh language used by Judge Rogers and her detailed criticism of Apple executives could trigger further regulatory scrutiny in other jurisdictions. Fiona Scott Morton, a former top U.S. antitrust official, said the ruling “might break the logjam that has enabled Apple to delay complying with similar requests in other jurisdictions.”

The decision comes just one week after the European Commission fined Apple for similar anticompetitive behaviour related to the App Store.

Apple to appeal, shares dip after hours

Apple said it would appeal the decision. “We disagree with the court’s ruling and are committed to defending our practices,” a company spokesperson said. Apple’s stock slipped slightly in after-hours trading following news of the court order.

The financial implications of the ruling remain unclear. Apple earns billions annually from in-app purchase commissions, and it’s uncertain how many users will actually shift to off-app transactions, even if permitted. Historically, most iPhone users have remained within the App Store ecosystem for convenience.

Nonetheless, the ruling represents a major legal and reputational blow to Apple—and it opens the door to potential criminal proceedings if federal prosecutors pursue the contempt referral.