Apple Fights Judge’s App Store Overhaul Order

Apple (NASDAQ:AAPL) moves to pause Judge Rogers’ order forcing it to let developers link out for in-app purchases, arguing that extraordinary intrusions into the App Store threaten irreparable harm.

In its Ninth Circuit stay request, Apple said last week’s injunctionpart of the Epic Games antitrust caseoverstepped by barring commissions on off-App Store transactions and dictating link placement and language in developers’ apps.

The company insists these mandates, never adjudicated as unlawful, would cost Apple substantial sums annually and undermine its ability to manage core App Store features. Epic Games fired back, calling Apple’s motion a last-ditch effort to block competition and extract massive junk fees, while spotlighting early developer freedom to offer better deals and payment methods.

Apple highlighted that compliance would strip it of control over App Store design and commerce, harming the iOS ecosystem it built. The filing stressed that Epicwithout any App Store presencewould suffer minimal harm from a stay, while Apple could face grave irreparable harm if forced to implement the link-out rule.

Spotify’s (NYSE:SPOT) recent app update, approved under the new order, lets the company display pricing and external purchase links, fostering transparency and choice, the music streamer said.

This appeal follows Apple’s January 2024 Supreme Court bid to review a similar 2021 ruling, which the High Court declined. Now, with its June 2021 concessions back in play, Apple’s lawsuit saga dates to 2020, when Epic challenged Apple’s 30% in-app fee after Fortnite’s removal. Bank of America estimates that full enforcement of the link-out order could cost Apple billions in lost commissions.

Why it matters: Pausing the link-out rule would protect Apple’s App Store economics and guard against a fundamental loss of platform controlkey to its services revenue model.

Investors will watch the Ninth Circuit’s decision on Apple’s stay motionlikely in the coming monthsto see if the company can maintain its App Store framework pending a full appeal.

This article first appeared on GuruFocus.