Epic Games, Inc. v. Apple Inc.

Analysis Group was retained on behalf of Apple in a high-profile antitrust suit brought by the game developer Epic Games (Epic), creator of the popular game Fortnite. Epic claimed that Apple’s App Store policies violate both federal and state antitrust law and California’s unfair competition law. Specifically, Epic alleged that Apple has a monopoly over both distribution and payment collection for the apps on its App Store.

An Analysis Group team led by Managing Principal Samuel Weglein and Vice President Kristof Zetenyi, and including Manager Solvejg Wewel and Vice President Big Banternghansa, supported academic affiliate Richard Schmalensee, who filed expert reports and testified at deposition and trial. Professor Schmalensee opined on issues of market definition, market power, and the economics of two-sided platforms like those identified by the US Supreme Court in Ohio v. American Express. He also rebutted the testimony of Epic’s experts.

Citing Professor Schmalensee’s testimony, Judge Yvonne Gonzalez Rogers of the US District Court for the Northern District of California found that the App Store is a two-sided transaction platform. Further citing Professor Schmalensee’s testimony at multiple points, she rejected all of Epic’s central challenges and validated Apple’s business model. Apple prevailed on all of Epic’s antitrust claims, Judge Gonzalez Rogers ruling for Epic only on a single count of violating California law as applied to developers’ ability to communicate with consumers.