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Apple exec Schiller defends App Store changes in Epic Games case
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Apple exec Schiller defends App Store changes in Epic Games case
May 22, 2024 2:46 PM

May 22 (Reuters) - Apple ( AAPL ) executive Phil Schiller fielded

hours of questions from lawyers and a California federal judge

on Wednesday, as the company battles claims that it violated an

order to allow more competition in its lucrative App Store.

It was Schiller's second day of testimony at the court

hearing in Oakland, where "Fortnite" maker Epic Games has asked

U.S. District Judge Yvonne Gonzalez Rogers to hold Apple ( AAPL ) in

contempt.

The judge convened the hearing to assess Apple's ( AAPL ) compliance

with her 2021 injunction, which required the Cupertino,

California-based company to allow developers more power to steer

app users to payment options outside of Apple's ( AAPL ) ecosystem.

In most instances, Apple ( AAPL ) charges developers a 30% commission

on users' purchases inside an app. Following Rogers' injunction,

it began allowing developers to include links to outside payment

options, but developers are still required to pay a commission

of 27% on such purchases.

Schiller and other executives have said the new policy,

which Epic cited as evidence of Apple's ( AAPL ) non-compliance, was a

legal, legitimate business decision.

"We're now competing to encourage developers to use our

payment system," Schiller said in court on Wednesday. He said

the company had worked hard following the 2021 injunction to

develop its new program.

"We have an interest with the court to get this accepted and

adopted," Schiller said.

Epic declined to comment on the hearing, and Apple ( AAPL ) did not

immediately respond to a similar request.

Rogers, over four days of hearings, has expressed skepticism

with some of Apple's ( AAPL ) arguments. She has questioned how the

iPhone maker came up with the new fee and asked what purpose

some of its App Store policies serve "other than to stifle

competition."

The judge, who could order additional changes to the App

Store, has not said when she will rule. The court will continue

hearing testimony on May 31.

Epic first sued Apple ( AAPL ) in 2020, claiming Apple's ( AAPL ) tight

controls over its App Store violated antitrust law. Determining

Apple's ( AAPL ) compliance with Rogers' injunction is all that remains

from the lawsuit, after the U.S. Supreme Court declined to

consider the case earlier this year.

The U.S. Justice Department in March accused Apple ( AAPL ) of

monopolizing the smartphone market, stifling competition and

innovation. The company has denied the claims and said in a

court filing on Tuesday it will ask a judge to dismiss the

lawsuit.

The case is Epic Games v. Apple ( AAPL ), U.S. District Court,

Northern District of California, No. 4:20-cv-05640.

For Epic: Gary Bornstein of Cravath, Swaine & Moore

For Apple ( AAPL ): Mark Perry of Weil, Gotshal & Manges

Read more:

Apple ( AAPL ) faces skeptical judge in App Store antitrust case

Apple ( AAPL ) denies violating US court order in Epic Games lawsuit

Epic Games says Apple ( AAPL ) violated App Store injunction, seeks

contempt order

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