In a resounding legal defeat for Apple (NASDAQ: AAPL), a US federal court has found the tech giant in civil contempt for willfully violating a 2021 injunction meant to curb its anticompetitive conduct within the App Store.
The ruling—issued by Judge Yvonne Gonzalez Rogers of the Northern District of California—effectively dismantles Apple’s control over external app payment systems and prohibits a wide range of restrictive practices the court deemed designed to “maintain an anticompetitive revenue stream.”
“The Court will not play ‘whack-a-mole,’ nor will it tolerate further delay,” Rogers wrote. “Time is of the essence.”
The injunction, effective immediately, bans Apple from imposing any commissions on purchases made outside apps and prohibits interference with how developers direct users to external payment platforms. Apple is also barred from auditing or tracking such transactions, restricting buttons or dynamic links, or using coercive language to dissuade users from leaving the app.
Sponsored · Selkirk Copper Mines
At the center of the court’s ire was Apple’s so-called “Link Entitlement” program, which the judge found to be a thinly veiled attempt to circumvent the court’s original ruling. Apple had applied a 27% commission—merely a 3% discount from its standard 30%—to external payments, which the court ruled rendered alternatives to Apple’s in-app purchases economically “non-viable.” Internal documents cited in the ruling showed Apple knew this model would preserve the “existing anticompetitive revenue stream,” revealing deliberate intent.
“The Court cannot conceive of how any reasonable mind… would find that structure permissible,” the ruling declared. “That appears to have been the point.”
In addition to the sweeping restrictions, the court referred Apple and its Vice President of Finance, Alex Roman, to the US Attorney’s Office for potential criminal prosecution over their contempt of court.
The decision marks a monumental victory for Epic Games, whose CEO Tim Sweeney declared: “Game over for the Apple Tax.”
Critics, including prominent developers, argue this outcome was avoidable. “Tim Cook could have had everything,” posted Basecamp co-founder David Heinemeier Hansson. “But he got blinded by the marginal dollar… Apple’s entitlement to the fruits of all apps proved poisonous.”
Information for this briefing was found via the sources mentioned. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
