Judge James Donato of the US District Court for the Northern District of California will decide the remedies needed to address Google’s conduct next year. Google said it would appeal the verdict.
Throughout the trial, Google’s lawyers and executives had argued that it competed against Apple’s App Store, which is more popular in the United States, making it impossible to operate an Android monopoly.
The verdict provided a lift to Epic’s yearslong quest to weaken the power that Google and Apple have over the mobile app ecosystem, and came two years after Epic mostly lost a similar case against Apple — a ruling that both sides are trying to appeal to the U.S. Supreme Court. That verdict was decided by a judge.
In pursuing the case against Google, filed in 2020, Epic had sought to keep more of the revenue it generates from in-app purchases and offer an app store that would compete with Play on the Android operating system.
Google was fighting Epic’s claims at the same time that it was defending itself in another antitrust trial in Washington, DC. The Department of Justice and dozens of states have accused the company of illegally maintaining a search and advertising monopoly, in a landmark antitrust case that could reshape tech power when it is decided next year.
On the Play Store, Google charges app makers a 15% fee for customer payments for app subscriptions and up to 30% for purchases made within popular apps that are downloaded from the store. Google says 99 per cent of developers qualify for a fee of 15 per cent or lower on in-app purchases.
Google plans to appeal the verdict and will “continue to defend the Android business model,” Wilson White, a Google vice president of government affairs, said in a statement. He added that the trial had “made clear that we compete fiercely with Apple and its App Store, as well as app stores on Android devices and gaming consoles.”
Epic said in a blog post that the verdict was “a win for all app developers and consumers around the world” and “proved that Google’s app store practices are illegal and they abuse their monopoly to extract exorbitant fees, stifle competition and reduce innovation.”
EPIC CEO Tim Sweeney posted “Free Fortnite!” on X, formerly Twitter, after the verdict.
Epic instigated the battle with Google, by allowing customers to make in-app purchases directly with Epic, bypassing Google and violating its rules. Google quickly banned Fortnite, and Epic responded by filing the lawsuit.
The jury found that Google had violated antitrust laws in two markets, the Android Play Store and the Android’s in-app billing system. It also found that Google willfully maintained monopoly power, allowing it to impose unreasonable restraints on other market players’ ability to compete.
The jury took issue with Google’s efforts to pay large developers to continue using the Play Store, in an initiative called Project Hug. Epic’s lawyers had painted the effort as “bribes” to major app makers, which Google had denied.
“Such a clear verdict is going to make it much harder for Google to beat it back in post-trial briefing and on appeal,” Paul Swanson, an antitrust lawyer at the firm Holland & Hard, said in an interview. He added that the district court process could wrap up in a few months, and Google’s appeal to the 9th U.S. Circuit Court of Appeals could take 12 to 18 months.
The jury also faulted Google’s agreements with Android phone makers such as Samsung, which force them to pre-install Google applications on their devices and establish other rules by which they must abide.
During the trial, Epic’s lawyers said Google had deleted some internal chat messages that may have been relevant to the case, which undercut the search company’s credibility, Swanson said.
“Google’s concern was that a jury would look at all of these issues they’ve examined for several weeks and put it through a lens of ‘Can I even trust Google?,’” Swanson said. “The stark reality is that Google finally had to face its consumers in the court of law.”
This article originally appeared in The New York Times.
Written by: Nico Grant
Photographs by: Haiyun Jiang
©2023 THE NEW YORK TIMES
