Apple’s obligations spelled out by a federal judge in the recent ruling that Apple Inc. willfully violated an injunction in a long-running, high-profile antitrust case Epic Games, creator of Fortnite. Accordingly, the company is currently referred for a criminal contempt investigation. In December, Judge Yvonne Gonzalez Rogers ordered Apple in contempt of court. She slammed the company for refusing to stop undermining competition, directly in defiance of a court injunction.
Epic Games originally sued both Apple and Google in 2021. Collectively, they made the case that Apple needs to allow their customers the freedom to use third-party payment methods. In her final ruling, Judge Gonzalez Rogers found that Apple had willfully violated the injunction. This conclusion was supported by detailed internal company documents examined during the trial proceedings. She expressed her concerns over Apple’s conduct, stating that “Apple knew exactly what it was doing and at every turn chose the most anticompetitive option.”
Judge Gonzalez Rogers’s contempt order draws attention to egregious conduct by Apple, including the assertion that a high-level Apple executive committed perjury. The judge expressed his disbelief that Apple CEO Tim Cook would override his chief product officer Phillip Schiller’s efforts to comply with the injunction. Instead, he apparently allowed CFO Luca Maestri to persuade him not to follow the court’s order. Although external risks certainly factored into Apple’s decision as well, internal discord was a major cause. They unilaterally set the commission on off-app purchases to 27%, a move many believe to be an attempt to circumvent the injunction.
In her decision, Judge Gonzalez Rogers unambiguously stated that “Cook simply made the wrong choice,” highlighting her firm reproach for the company’s approach. She ultimately referred the case to the U.S. Attorney for the Northern District of California. They will negotiate whether criminal action against Apple is justified.
Despite the injunction, Apple purportedly went on to continue its anti-competitive practices which stifled competition. As Judge Gonzalez Rogers heavily emphasized in her ruling, this kind of misconduct “will not be tolerated.” This gives an added shot of deterrent power to the court’s efforts to enforce compliance by corporations with the court’s legal directives.
There are implications beyond Apple in this case. Most importantly, it raises fundamental questions about national corporate governance and accountability that go beyond just one problematic company or even the technology sector. Epic Games has even suggested a potential resolution, with CEO Tim Sweeney proposing a peace proposal: “If Apple extends the court’s friction-free, Apple-tax-free framework worldwide, we’ll return ‘Fortnite’ to the App Store worldwide and drop current and future litigation on the topic.”
Though the tides are boiling now, as the story continues, these legal challenges from Apple will help reshape their business practices and approach to competition in the marketplace. The upcoming investigation into its conduct could have lasting ramifications for how tech giants operate in relation to antitrust laws.