Context: Epic Games recently scored a major trial win over Google in one of the #FreeFortnite cases, with remedies to be discussed soon (previous article on this topic). But Epic lost on the 9 federal claims out of 10 counts after the 2021 Apple trial, winning only an anti-anti-steering injunction under California state law. The Ninth Circuit affirmed the overall outcome. Both Epic and Apple filed petitions for writ of certiorari (“cert petitions”) with the Supreme Court of the United States (SCOTUS) (Epic cert docket; Apple cert docket). Apple’s petition has amicus brief support (albeit partly from those beholden to Apple); Epic’s does not, which may have been a tactical decision.
What’s new: All of the related submissions were delivered to the Justices’ chambers in late December, and the petitions are on the agenda for their Friday (January 12) conference.
Direct impact: SCOTUS may accept or reject a petition; postpone the decision on what to do; or ask the U.S. government for input (Call for the View of the Solicitor General (CVSG)), which is reportedly preparing its own antitrust lawsuit against Apple. As the two petitions address different aspects of the same case, they can fare differently: one could be more successful than the other. If Apple’s petition is rejected, the anti-anti-steering injunction will enter into effect in the nearest term, forcing Apple to tolerate that all apps (at least in the U.S. market) may inform consumers of alternative purchasing methods such as websites were in-game currency or in-game items can be bought. If Epic’s petition is rejected, its federal antitrust claims against Apple will have failed definitively.
Wider ramifications: The dispute is of importance to all iOS app makers. Even if only the “consolation prize” awarded to Epic by the district judge became enforceable, it would make an impact that varies from app to app. Epic’s petition also raises a general question about the requirements for less restrictive alternatives (to anticompetitive conduct). Apple’s petition deals with the question of whether the district court was right to grant a U.S.-wide injunction under California state law not only to Epic but to the benefit of all iOS app makers, and the Supreme Court is currently considering a case (Murthy v. Missouri) that is also about the scope of an injunction relative to the standing of the actual plaintiffs.
The procedural situation is now very complex. The purpose of this article is to break it down in simple terms to the extent anything can be simple at this stage, after long decisions by the trial court and the appeals court.
What’s striking is that Epic’s petition received precisely zero support from amici curiae (“friends of the court”), though there were more than ten of them two years ago who came out in support of Epic’s appeal to the Ninth Circuit. The amicus brief support that Apple has is partly from astroturfers in its own pocket, but there is support.
It is statistically implausible that out of a double-digit number of amici supported Epic in Round 2 (Ninth Circuit), not a single one wanted to file something at this stage. The focus has changed, with Epic raising a very narrow legal question (technically two, but they’re closely related). Still, if certain stakeholders wanted Epic to win before, why aren’t they trying to help now?
It does happen that parties dissuade potential amici from filing. Normally, however, the ones to do so are the respondents, not the petitioners. That’s because any amicus brief has the potential to make an issue appear more “certworthy” (deserving of SCOTUS review). Certworthiness is a question of how important a legal question is and not based on an assessment of a likelihood of success. It is in a respondent’s interest to downplay the importance of a matter, which is why amicus briefs supporting the respondent could be counterproductive.
Here, however, the question is whether Epic in its role as a petitioner (seeking to revive its federal antitrust claims) actually talked potential amici out of chiming in. While games fray has no knowledge of who talked to Epic and what Epic said, the complete absence of filings in Epic’s support strongly suggests coordination. Orchestrated silence. There are two possible reasons on Epic’s side that are not even mutually exclusive:
- If there had only been very weak support from amici, Epic might have preferred for no one to file. It may seem counterintuitive that something should not be better than nothing, but this is a situation where nothing may be better than little.
- Epic may consider the outcome after the first two rounds one it can live with: not what they originally wanted, but they’d rather let that state law injunction enter into effect than take any risks. If that is the objective, then it’s best for Epic not to make the case (even though the petitions are disparate) seem more important than necessary. Put differently, even though Epic is a petitioner with respect to what is theoretically the larger and more important part of the case (the federal antitrust claims), Epic may be prioritizing its interests as a respondent to Apple’s petition, hoping to downplay the relevance of the case as a whole.
There is no symmetry rule here, though: SCOTUS could accept Apple’s petition and reject Epic’s, or vice versa.
Should Epic’s petition be granted, there will undoubtedly be a lot of amicus brief support from organizations of different types and sizes.
Apple’s reply brief notes that Epic has no amicus brief support and attributes it to the fact that its petition just raises a case-specific factual question (while stressing how much more important Apple deems its own petition). But that is so only in the world according to Apple.
What Apple wants: at minimum, delay
Apple managed to fend off a motion by Epic asking SCOTUS to let the state law injunction enter into effect even while Apple’s cert petition is pending. For Apple, the absolute minimum goal is to achieve further delay. If the SCOTUS opted for a CVSG (for the definition, see the section on direct impact further above), that all by itself would mean a few more months during which the injunction wouldn’t enter into force.
Apple doesn’t like the injunction regardless of the exact scope, but has no problem with a modified version (if its petition succeeded) that would apply only to Epic. After Epic’s “hotfix” in the summer of 2020 that started the dispute, Apple terminated Epic’s developer agreement, and only if Epic prevailed on its more important claims would it be allowed to return.
If other app makers than Epic benefited from the anti-anti-steering injunction only in California, Apple wouldn’t like it, but they’d prefer that outcome over a nationwide injunction as the incentive for app makers to then exercise the freedoms afforded by the injunction would be rather limited. App makers would have to make sure that only California-based customers receive certain information on alternative purchasing methods.
SCOTUS decision to hear Murthy v. Missouri works in Apple’s favor
While the briefing process for the two cross-petitions was underway, something happened that Apple may benefit from (even if only for the purpose of delay as discussed in the previous section):
On October 20, SCOTUS decided to hear Murthy v. Missouri (docket). As the state of Missouri doesn’t operate an app store or similar platform, the caption alone makes it clear that there’s no commercial connection. Mr. Murthy is the Surgeon General of the United States and the case is about whether federal government officials can talk to social media platforms to remove misinformation (in that csae, related to COVID). It may look like it’s unrelated, but there is a common element: the question of whether an injunction can have a broader scope, in terms of the affected parties, than the case in which it issues. In Murthy, the U.S. government argues that a district court went too far by prohibiting certain types of speech by all federal government officials.
If Murthy is resolved on some other grounds than the part that bears a resemblance to the question raised by Apple in its petition, then it won’t matter. But injunction scope is one of the issues and might be reached.
A shortcut was taken on October 20. The first thing the U.S. government did was to ask SCOTUS to stay the enforcement of the injunction in question (docket of stay application). It was an emergency motion, and those motions are resolved quickly while the whole cert briefing process can still take a while. Here, the motion to stay (before SCOTUS, it’s called an application for a stay) was submitted on September 14, and Justice Alito ordered several successive short stays in order to have enough time to consider the motion. The final deadline was October 20, and the decision was then made by the entire SCOTUS because Justice Alito referred the matter to his colleagues. The stay was granted for the entire proceedings, and SCOTUS decided not even to wait for further briefing on a cert petition:
The application for stay is also treated as a petition for a writ of certiorari, and the petition is granted on the questions presented in the application (case No. 23-411).
Apple is not just acting opportunistically now. In (late) September, three weeks before SCOTUS decided to hear Murthy, Apple filed its cert petition in the Epic case and discussed Murthy:
c. The United States Department of Justice has also raised concerns about federal courts issuing nationwide injunctions that are overbroad and unconstitutional, including in a recent application pending before this Court seeking to vacate such an injunction. See Application for Stay, Murthy v. Missouri, No. 23A243 (U.S. Sept. 14,2023), at 34–36 (arguing that the Constitution and principles of equity require that any injunction be limited to the particular plaintiffs in the action). In light of the forthcoming petition in that case, the Court may wish to invite the Solicitor General to file a brief expressing the views of the United States on this one; at minimum, this petition should be held pending the outcome of the government’s similar challenge to the injunction in the Murthy case.
2. This case is an ideal vehicle to address the constitutional and prudential problems presented by overbroad injunctions in the federal courts.
As Murthy illustrates, many recent cases have involved nationwide injunctions against the federal government, where public policy and practical considerations might (or might not) sometimes weigh in favor of broader relief. See Alan M. Trammell, Demystifying Nationwide Injunctions, 98 Tex. L. Rev. 67, 77 (2019). Unlike private parties, the government is generally required to treat similarly situated individuals similarly. A private company such as Apple is not subject to the same considerations: Ordering Apple to provide relief only to Epic would not offend any applicable equal-treatment principles. Accordingly, nationwide injunctions against private parties present even more serious issues than those against the government.
Epic trying to revive its federal antitrust claims
Epic’s petition is meant to bring its federal antitrust claims back to life. Apple argues that even if Epic’s petition was granted and SCOTUS agreed with Epic, the outcome would be the same as Epic, in the district court’s opinion, didn’t come close to winning. But what Epic wants is a new rule-of-reason balancing, and its petition could lead to that.
What would represent the biggest opportunity for Epic is a retrial in which Epic could present new evidence, including new expert evidence, and learn from what went wrong against Apple the first time and what worked out so well against Google last year.
Epic came close to convincing the Ninth Circuit that the district court got the market definition wrong. The appellate judge who did most of the talking during the hearing, Judge Milan D. Smith, made it clear at the outset that he believed the first step in an antitrust case like this is to get the market definition right. But Apple convinced him that Epic had failed to prove a single-brand Kodak market. The most senior one of the three panel members (Judge Sidney R. Thomas, a former chief judge of that court) didn’t say much at the hearing, and dissented from the majority. A Thomas-Smith majority was not unthinkable, but Apple succeeded, and now Epic is just hoping to reopen the rule-of-reason balancing discussion.
There are many possible permutations, but soon there will be some clarity at least with respect to what questions the top U.S. court is prepared to decide. Once SCOTUS has taken its position on the cert petitions, games fray will comment again and explain the implications.