(Reuters) - Apple ( AAPL ) violated a U.S. court order that required the iPhone maker to allow greater competition for app downloads and payment methods in its lucrative App Store and will be referred to federal prosecutors, a federal judge in California ruled on Wednesday.
U.S. District Judge Yvonne Gonzalez Rogers in Oakland said in an 80-page ruling that Apple ( AAPL ) failed to comply with her prior injunction order, which was imposed in an antitrust lawsuit brought by "Fortnite" maker Epic Games.
"Apple's ( AAPL ) continued attempts to interfere with competition will not be tolerated," Gonzalez Rogers said. She added: "This is an injunction, not a negotiation. There are no do-overs once a party willfully disregards a court order."
Gonzalez Rogers referred Apple ( AAPL ) and one of its executives, Alex Roman, vice president of finance, to federal prosecutors for a criminal contempt investigation into their conduct in the case.
Roman gave testimony about the steps Apple ( AAPL ) took to comply with her injunction that was "replete with misdirection and outright lies," the judge wrote.
Neither Apple ( AAPL ) nor Epic immediately responded to requests for comment.
Epic accused Apple ( AAPL ) of stifling competition for app downloads and overcharging commissions for in-app purchases.
Gonzalez Rogers in 2021 found Apple ( AAPL ) violated a California competition law and ordered the company to allow developers more freedom to direct app users to other payment options.
Apple ( AAPL ) failed last year to persuade the U.S. Supreme Court to strike down the injunction.
Epic Games told the court in March 2024 that Apple ( AAPL ) was "blatantly" violating the court's order, including by imposing a new 27% fee on app developers when Apple ( AAPL ) customers complete an app purchase outside the App Store. Apple ( AAPL ) charges developers a 30% commission fee for purchases within the App Store.
Apple ( AAPL ) also began displaying messages warning customers of the potential danger of external links in order to deter non-Apple ( AAPL ) payments, Epic Games alleged, calling Apple's ( AAPL ) new system "commercially unusable."
Apple ( AAPL ) has denied any wrongdoing. The company in a court filing on March 7 told Gonzalez Rogers it undertook "extensive efforts" to comply with the injunction "while preserving the fundamental features of Apple's ( AAPL ) business model and safeguarding consumers."
Gonzalez Rogers suggested at an earlier hearing that changes made by Apple ( AAPL ) to its App Store had no purpose "other than to stifle competition."
In Wednesday's ruling, Gonzalez Rogers said Apple ( AAPL ) is immediately barred from impeding developers' ability to communicate with users, and the company must not levy its new commission on off-app purchases.
She said Apple ( AAPL ) cannot ask her to pause her ruling "given the repeated delays and severity of the conduct." She took no view on whether a criminal case should be opened.
"It will be for the executive branch to decide whether Apple ( AAPL ) should be deprived of the fruits of its violation, in addition to any penalty geared to deter future misconduct," the judge wrote.