Apple Violated Court Order on App Store Payments, Faces Possible Criminal Probe

Apple has been found in violation of a federal court order requiring the company to allow third-party payment options within its App Store, a ruling that could carry significant financial and legal repercussions.

U.S. District Judge Yvonne Gonzalez Rogers delivered a scathing rebuke of the tech giant, accusing it of “willfully” ignoring her 2021 injunction and referring the matter to federal prosecutors for a potential criminal contempt investigation, according to Bloomberg.

The ruling stems from Apple’s long legal battle with Epic Games Inc., the creator of hit game Fortnite, which began after Epic challenged Apple’s tight control over in-app purchases. While Apple defeated most of the original claims in the 2021 case, the court mandated that it loosen its restrictions and allow developers to direct users to third-party payment methods—an order the judge now says Apple deliberately circumvented.

According to Bloomberg, Gonzalez Rogers found that Apple implemented a revised policy in 2024 that levied a 27% fee on purchases made via external links, a move she said was designed to preserve the company’s lucrative commission stream while appearing to comply with the order. This minimal discount from Apple’s typical 30% in-app purchase fee was deemed anticompetitive and in direct violation of her ruling.

“This is an injunction, not a negotiation,” Gonzalez Rogers wrote. “There are no do-overs once a party willfully disregards a court order.”

Further compounding Apple’s legal woes, the judge accused Vice President of Finance Alex Roman of lying under oath about the timing of Apple’s decisions regarding its new commission policy. “Neither Apple, nor its counsel, corrected the, now obvious, lies,” she wrote, stating that the company had “adopted the lies and misrepresentations to this Court.”

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Gonzalez Rogers also stated that Apple withheld key internal documents from the court, including records of a June 2023 meeting involving CEO Tim Cook regarding compliance with the original order. She said that Apple had attempted to shield its decision-making process through the misuse of privilege claims, adding that Cook ignored the advice of senior executive Phil Schiller, who had opposed charging a fee on off-app purchases.

In a decision that could dent Apple’s multi-billion-dollar App Store revenue, the judge ordered the company to cease all commissions on web-based purchases made through links in iPhone apps, effective immediately. Apple was also instructed to pay Epic Games’ legal fees for this specific contempt issue.

Per Bloomberg, Apple faces a second looming threat to its revenue stream in the form of an ongoing Department of Justice antitrust case questioning payments the company receives from Alphabet Inc.’s Google to remain the default search engine on Safari.

Epic Games CEO Tim Sweeney hailed the ruling as a pivotal win for software developers, telling reporters, “It’s a huge victory for developers, and it means all developers can offer their own payment service side-by-side with Apple’s payment service.”

Apple, meanwhile, pushed back on the ruling. “We strongly disagree with the decision. We will comply with the court’s order and we will appeal,” a spokesperson said. Roman has yet to respond publicly.

Source: Bloomberg