9th Circuit denies Apple’s rehearing requests in Epic Games case

Apple suffered a significant setback in its case against Epic Games today, as the Ninth Circuit denied both of its rehearing petitions. Here are the details.

A very compressed bit of context

Epic Games filed a lawsuit against Apple in August 2020 with 10 claims, after being removed from the App Store.

Apple took action after Epic changed Fortnite’s in-app purchase system to bypass App Store rules, a move later confirmed to be deliberate.

Following a lengthy legal battle, Apple was found to have violated California’s Unfair Competition Law by restricting developers’ ability to steer users to alternative payment methods.

That ended up being Epic’s only win, with the court rejecting the other nine claims.

But it was a significant win, particularly after last year, when Judge Yvonne Gonzalez Rogers found Apple in breach of her original 2021 ruling and ordered the company to allow developers to link out to alternative payment methods without imposing restrictions.

Apple, in turn, argued that the order improperly broadened the original ruling (which applied only to Epic), and appealed to the U.S. Court of Appeals for the Ninth Circuit.

The court of appeals then heard Apple’s case with a three-judge panel, and largely upheld the lower court’s decision.

This led Apple to file two petitions: one asking for a rehearing before the same three judges who heard the case. The second, asking for a rehearing en banc, which would have the full Ninth Circuit reconsider the decision.

Apple’s main argument was that the ruling created confusion around what it would actually be allowed to charge for purchases made outside the App Store.

In a nutshell, Apple pointed to two possible interpretations: one limiting it to charging only the direct costs of supporting external purchases, while the other would allow it to collect a broader commission tied to the value of the App Store and its ecosystem.

Which brings us to today.

Court dismisses both requests

Earlier today, the U.S. Court of Appeals for the Ninth Circuit issued its decision, unanimously denying Apple’s petition for the three-judge panel rehearing. This means that all three judges rejected Apple’s bid.

As for the rehearing en banc, Judge M. Smith voted to deny the petition, while Judge S.R. Thomas and Judge McShane recommended it. However, as the document states:

The full court has been advised of the petition for rehearing en banc, and no judge of the court has requested a vote on it. […] The petition for panel rehearing and the petition for rehearing en banc
are DENIED.

With this decision now in the books, Apple has a very limited set of options, including trying to take the case to the Supreme Court once again.

The first time around, both Apple and Epic sought Supreme Court review of an earlier Ninth Circuit ruling, but the justices declined to take up the case.

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