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Apple Loses Appeal to Delay App Store Antitrust Reforms in Epic Games Case

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Apple has failed in its latest attempt to delay a U.S. court order requiring changes to its App Store practices, marking a significant setback in its long-running legal battle with Epic Games. The 9th U.S. Circuit Court of Appeals on Wednesday rejected Apple’s request to pause enforcement of parts of the federal judge’s injunction while it pursues further appeals.

The case stems from Epic Games’ 2020 lawsuit challenging Apple’s control over its iOS App Store and in-app payment system. Epic argued that Apple’s policies stifle competition and allow it to collect excessive fees from app developers.

Court Orders Apple to Open App Store to More Competition

In April, U.S. District Judge Yvonne Gonzalez Rogers found Apple in contempt of her previous injunction and ordered the company to immediately cease several business practices that restricted developers’ ability to direct users to alternative payment options. Among the practices targeted was Apple’s introduction of a 27% fee on developers who facilitate payments outside of the App Store—a fee the judge said was an attempt to sidestep the original injunction.

Additionally, the court barred Apple from restricting where app developers can place links or buttons that lead users to external purchasing platforms.

Epic Games CEO Tim Sweeney celebrated the appeals court decision on social media, stating that the “long national nightmare of the Apple tax is ended.”

Apple Argues for Business Control, Epic Sees New Competition

In its emergency appeal, Apple argued that the ruling strips it of control over “core aspects of its business operations” and unfairly compels the company to give developers free access to its platform services. Apple also expressed disappointment at the appeals court decision but vowed to continue its legal battle.

Epic Games countered that Apple’s actions were aimed at preserving its dominance and maintaining revenue streams that the court had ruled were anti-competitive. Epic claimed that since the injunction was issued, many developers have already introduced better payment systems, improved deals, and expanded choices for consumers, increasing genuine competition on iOS.

Ongoing Legal Risks for Apple

This latest ruling leaves Apple exposed to continued legal and regulatory scrutiny. Judge Gonzalez Rogers previously accused Apple of misleading the court about its compliance efforts and referred both Apple and one of its executives to federal prosecutors for potential criminal contempt charges.

While Apple won most aspects of the original lawsuit in 2021, Gonzalez Rogers did rule that the company must allow developers to inform users about alternative payment options outside of Apple’s in-app purchase system.

The outcome of Apple’s ongoing appeal will likely have significant implications for the future of digital marketplaces and the company’s multibillion-dollar App Store revenue.

Elon Musk Faces Fraud Lawsuit Over Delayed Twitter Stake Disclosure

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Elon Musk must face a fraud lawsuit after a U.S. judge ruled that shareholders sufficiently alleged that he defrauded them by delaying the disclosure of his Twitter stake, now known as X. U.S. District Judge Andrew Carter in Manhattan rejected Musk’s attempt to dismiss the case, which was brought by former Twitter shareholders, including the Oklahoma Firefighters Pension and Retirement System.

The lawsuit claims that Musk’s delayed SEC filing on his initial 5% Twitter stake, which was not disclosed until 11 days after the March 24, 2022, deadline, caused shareholders to sell their stocks at artificially low prices, ultimately costing them more than $200 million. Musk’s eventual filing revealed that he had acquired a 9.2% stake, which sent Twitter shares up by 27% in early April 2022.

Judge Carter found that Musk’s filing and his tweets about potentially creating a Twitter rival or altering the platform’s logo could have misled investors into thinking Musk was making a “passive” investment and did not intend to take over the company. While some claims were dismissed, the case will proceed to explore whether Musk’s actions were fraudulent.

Brave Software Sues News Corp Over Copyright Dispute

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In a significant legal battle, Brave Software has filed a lawsuit against News Corp in response to a cease-and-desist letter sent by the media conglomerate. The letter warned Brave that it faced potential litigation for allegedly “scraping” copyrighted content from News Corp’s websites, including those of The Wall Street Journal and New York Post. The suit was filed on Wednesday night in San Francisco federal court.

Brave, the company behind the Brave Search engine, argues that its actions are covered under the “fair use” doctrine, asserting that indexing website content is a necessary practice for search engines to operate. The company also contends that News Corp’s actions could undermine advancements in generative AI, claiming that chatbots such as ChatGPT and Google’s Gemini rely on search engine responses, which could be impacted by this dispute.

According to Brave, its market share is a fraction of the search industry, with its search engine holding less than 1% of the market, while Google dominates with nearly 90%, followed by Microsoft’s Bing. Brave accuses News Corp and its partners of attempting to “bully” the company and further cementing the already high barriers to entry in the search engine market.

In a public statement, Robert Thomson, CEO of News Corp, rejected Brave’s claims, labeling the company’s actions as “piratical, parasitical practices” disguised as traditional search. He emphasized that the unauthorized use and sale of News Corp’s copyrighted content to AI engines and other clients is not fair use, but a blatant violation of intellectual property rights.

This legal battle adds to the growing tensions between publishers and tech companies over the use of copyrighted content in support of AI technologies. News Corp has previously filed lawsuits against other companies, including Perplexity AI, for alleged unauthorized copying of its articles.

In its lawsuit, Brave is seeking a declaration from the court that its use of copyrighted News Corp content for search indexing purposes is not a form of infringement. The case highlights the broader conflict between content creators, who argue for protection of their intellectual property, and technology companies, which push for more access to such content to power AI developments.