Robert Besser
07 Feb 2025, 10:47 GMT+10
SAN FRANCISCO, California: Google is fighting to overturn a jury verdict that found its Play Store an illegal monopoly, urging a federal appeals court to block penalties imposed to curb its dominance in the Android app market.
Meanwhile, Epic Games, the company behind Fortnite, is pushing to uphold the ruling, arguing that it will boost innovation and lower prices for consumers.
During an appeals hearing in San Francisco, Google attorney Jessica Ellsworth argued that U.S. District Judge James Donato wrongly allowed the market definition in the Google antitrust trial to differ from a similar 2021 case against Apple.
Unlike Google, Apple won its case after a judge ruled that its App Store was part of a broader competitive market. Ellsworth also contended that the case should never have gone before a jury, as Google had initially agreed to have a judge decide, similar to Apple's trial.
"You can't just lose an issue that was fully litigated the first time (in the Apple case) and then pretend it didn't happen," Ellsworth said, insisting that Google and Apple's rivalry in the smartphone operating system market "sufficiently disciplines" competition in their app stores.
However, the three-judge panel seemed unconvinced by Google's argument. Judge Danielle J. Forrest pointed out key differences between the two companies' ecosystems, noting that Apple's tightly controlled "walled garden" is distinct from Google's licensing model, which allows various smartphone manufacturers to use Android and the Play Store.
"There are clearly some factual differences between the Android world and Apple world," Forrest told Ellsworth.
Judge Gabriel Sanchez also pushed back, questioning whether Google's competition with Apple in operating systems justifies monopolistic behavior within its own app store. "Even if Google vigorously competes with Apple, that doesn't mean it can't create a different ecosystem where it's a monopolist," Sanchez said.
Epic's attorney, Gary Bornstein, accused Google of using inflated commissions of 15% to 30% on in-app purchases to maximize profits, arguing that the company now seeks to delay reforms that would introduce fairer competition.
The penalties, imposed by Judge Donato in October but postponed pending appeal, would require Google to open its Play Store to competitors, which could lower commission rates across its two-million-app library.
The appeals court has not indicated when it will rule on Google's request, but decisions typically take months. Meanwhile, Google is also facing separate antitrust penalties after another judge ruled its search engine is an illegal monopoly, potentially forcing the company to divest its Chrome web browser.
The jury trial process also emerged as a point of contention during the hearing. When Google settled lawsuits from U.S. attorneys general and Match Group, it attempted to revert to a judge-led trial-a request denied by Donato. Judge Forrest speculated about sending the case back to Donato for a more detailed ruling, a move Ellsworth welcomed. However, Bornstein dismissed this as giving Google more time to profit from its illegal conduct, urging the appeals court to uphold the jury's decision.
"The benefit of the doubt does not go to the wrongdoer," Bornstein said.
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