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Epic vs. Apple Australian side quest allowed to resume

Federal Court finds Apple is neither “ornamental” nor “parasitic” and thinks local action is appropriate despite US case

Epic Games has had a win in Australia, with the nation’s Federal Court permitting it to sue Apple over its insistence that it alone can process in-app purchases.

The developer of hit game Fortnite sued Apple in Australia in November 2020, as a side quest to similar action in the USA brought after Epic offered its own in-app payments in the game and saw its game banished by Apple.

Apple countered that suit by arguing that the case was already being tried in California courts, and won a stay on the Australian action.

Australia’s Federal Court today overturned that stay, and allowed Epic to proceed with its suit down under.

In their judgement, Justices Middleton, Jagot and Moshinsky found three reasons that the decision to grant a stay was in error.

One was that the previous judges failed to consider all of the matters when pondering whether a stay should be granted. The second was that litigation in the USA can’t result in relief being granted in Australia.

The third error was the previous decision’s characterisation of Apple’s role in app sales as “ornamental” or “parasitic”. Those descriptions, the Federal Court argued, meant Apple’s role in the Australian market was not given proper consideration.

The Court also just fancied the idea of testing the case in Australia, rather than waiting for a US precedent to ponder.

Apple swiftly said it would appeal the decision, on grounds that its contract with Epic requires the two companies to conduct litigation in California.

Epic has hailed the decision as a win for Australian consumers, even though it still has to actually win its case.

While lawyers in Australia start to forecast extra billings in the case (good barristers alone cost at least US$6000 a day), Epic and Apple await the outcome of their California case, which wrapped up in May 2021. A judgment could be only a few weeks away. ®

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