How Apple created a legal mess when it took over the ruling of the judge

A few weeks after a Federal Court of Appeal said that Apple should release its grip on his App Store, Tim Cook, the chief executive of the company and his best lieutenants about what to do.

For more than a decade, Apple needed that apps use the App Store payment system and collected a 30 percent commission on the sale of apps. Now, in 2023, the courts ordered to allow apps to avoid Apple’s payments and go directly to online consumers. Mr. Cook wanted to know: could Apple still be able to charge a committee for those sales without violating a judicial order?

Phil Schiller, who supervised the App Store, was worried that new costs could be illegal. He preferred to free online sales from an Apple Commission. Luca Maestri, who supervised the finances of the company, did not agree. He was preferred to charge a committee of 27 percent for online sales because it would protect the activities of the company.

Mr. Cook chose Mr. Maestri and Apple wanted to justify that choice. It ‘produced’ an independent economic investigation to identify his decision, a federal court said in an angry ruling last week. It has withheld thousands of documents under law firms for lawyers. And at least one of the managers lied on the witness bank.

The ruling of the judge, as well as witness this year and company documents released on Thursday, shows the extraordinary measures that Apple has taken to keep every cent that had collected in the App Store. The decision of judge Yvonne Gonzalez Rogers, who heard the first lawsuit brought by the video company Epic Games in 2020, could for many years cast a shadow on Apple’s things, which intensifies the credibility of his credibility of his activities.

The company also tries to ward off half a dozen other legal challenges, including An antitrust lawsuit accusing the enforcement of an iPhone monopoly, Class Action -Rights Affairs of App -developers in the United States and competitive extension of its App Store by the European Union” Britain” Spain and potential China.

“If you burn your credibility at the courts, the next judge will be much less willing to forgive,” said Mark A. Lemley, professor of antitrust and technology right in Stanford. In future cases for Apple, he said, “It will be easier for a judge to come to the conclusion that people lie.”

Google has shown that the actions of a company can shed a shadow on legal procedures with high deployment. Last month, in an antitrust case About the advertising technologyA judge said that the efforts of the company to hide his communication had asked questions about whether it would follow the court’s legal remedies for his behavior.

Apple is attractive judge Gonzalez Rogers’s ruling, which the company has kept in civil contempt. When applying for a delay in the court’s order to release its grip in the App Store, Apple said on Wednesday that it would show that the contempt was ‘unjustified’. The company refused to comment on this article.

Epic, the developer of Fortnite, Apple charged In 2020 accusing to violating antitrust laws by forcing developers to use his App Store payment system. Judge Gonzalez Rogers largely judged Apple and discovered that it was not a monopoly, as Epic had argued. But She said Apple had violated the Californian competition legislation And the company ordered to allow apps to record links and buttons to buy software and services outside the App Store.

Apple created a Task Force, Code-mentioned Wisconsin Project, to respond to the order. It considered two different solutions. The first would enable apps to record links for online purchases at limited locations, free from a committee. The second would enable apps to offer those links where they wanted, but force them to pay a commission of 27 percent for sale.

With links and no committee, Apple estimated that hundreds of millions of dollars could lose, even more than $ 1 billion. With a committee of 27 percent it would lose almost nothing.

Mr. Cook met the team in June 2023. He assessed a series of commissions options, from 20 to 27 percent. He also evaluated analysis that shows that few developers would leave Apple’s payment system for themselves if there was a commission of 27 percent, according to judicial data. In the end he chose that rate and he also approved a plan to limit where apps place links for online purchases.

Afterwards, Apple hired an economic consultant, analysis group, to write a report that Apple could use to justify its costs. The report concluded that the developer tools and distribution services of Apple were worth more than 30 percent of the turnover of an app.

Apple has also made screens to discourage online purchases by making them look scary and ‘dangerous’, according to judicial documents. Mr Cook weighed and asked the team to revise a warning to emphasize Apple’s privacy and security. Instead of “you will no longer be executed with Apple”, the company said: “Apple is not responsible for the privacy or security of purchases on the internet.”

When Apple unveiled his 27 percent committee in January 2024, Epic submitted a claim to the court that Apple did not follow the judge’s order. Judge Gonzalez Rogers brought Apple and Epic back to court. Alex Roman, a vice -president of finance, testified that Apple had made its final decision on its committee on January 16, 2024.

Judge Gonzalez Rogers wondered if Apple told the truth and asked the company to provide documents about the plans. It produced 89,000 documents, but claimed that a third of them were confidential. The court said that those claims were “not -under construction” and forced Apple to reverse more than half of the documents.

The documents made it clear that Mr Roman had lied under Ede that the report of the analysis group was an “appearance” and that Apple “deliberately” had a judicial order, said Judge Gonzalez Rogers. She called it a ‘cover-up’.

Her ruling will give officers of justice, supervisors and judges ammunition against Apple’s defense strategies in half a dozen similar cases around the world, said different antitrust and technology law professors and lawyers.

When the company tries to edit or withhold documents, prosecutors and judges may point to how those strategies “tactics have been found to postpone the procedure” in the Epic Games case, these experts said. When Apple managers witnesses, prosecutors and judges could question their credibility, because the company turned out to “hide the truth” and “outright lie”.

In the antitrust case of the Ministry of Justice and others to Apple, Colin Kass, an antitrush vocaat at Proskauer Rose, courts and supervisors who are looking for Apple documents “will start the process by saying:” Open your doors and do not dare to try those crazy small games that you have used in the past. “

The company will also be confronted with more skepticism about defenses, in the lawsuit of the Ministry of Justice, said Rebecca Haw Allesworth, Professor of Law at Vanderbilt University that Antitrust studies. In the past, Apple has said that the green bubbles shows for messages from an Android owner because communicating in smartphone systems is less safe. But she said those claims after the epic statement can be considered less credible.

Mrs Allenworth said that the judge’s opinion also could stiffen the determination of the European Union, Great -Britain, Spain and others who indicate Apple to change its App Store practices, because supervisors and courts often find safety.

“Apple has worn as if they were above the law,” she said. “This sends a signal that Apple is not.”