Apple has landed itself in serious legal trouble after taking extraordinary steps to preserve its App Store profits — despite a judge’s explicit order to loosen control over app payments.
Court records and newly released documents show that Apple went as far as commissioning a “sham” economic report, misleading the court, and having an executive lie under oath. The fallout from this case could weaken Apple’s credibility in upcoming legal battles and regulators’ investigations around the world.
The Epic Catalyst
The legal drama stems from a yearslong dispute with Epic Games, the maker of Fortnite, which sued Apple in 2020 for allegedly violating antitrust laws by forcing developers to use its payment system — and pay a 30% commission.
While U.S. District Judge Yvonne Gonzalez Rogers largely sided with Apple in her 2021 ruling, she found the company had violated California competition law. She ordered Apple to allow developers to include links or buttons within their apps directing users to make purchases outside the App Store.
What followed was a scramble inside Apple. The company formed a task force, code-named Project Wisconsin, to figure out how to comply — or at least appear to — without sacrificing revenue.
Apple’s Internal Debate
In mid-2023, Apple CEO Tim Cook and top executives debated how to respond. App Store chief Phil Schiller warned that charging a fee for outside payments could be illegal. But CFO Luca Maestri pushed for a 27% commission on out-of-app transactions — just slightly below the standard 30%.
Cook ultimately backed Maestri, and Apple set out to justify that choice.
The company hired consulting firm Analysis Group to produce a report supporting the 27% rate. It also implemented user interface warnings meant to dissuade users from making purchases on the web, revising the language at Cook’s suggestion to emphasize Apple’s lack of responsibility for privacy and security in external transactions.
Judge Calls Foul
Epic returned to court in early 2024, accusing Apple of defying the court’s original order. Apple claimed its changes complied. But when pressed, Apple executives testified — falsely, according to the judge — that the Analysis Group report had influenced their decision-making and that the 27% rate was set in January 2024.
Documents later revealed the decision was made months earlier, in mid-2023, and that the report was ordered only afterward to justify a predetermined outcome.
Judge Gonzalez Rogers was not convinced. She found Apple in civil contempt, calling its conduct a “cover-up” and the report a “sham.” She ruled that the company had “willfully” disregarded her orders, withheld key documents under false claims of privilege, and misled the court.
Legal Consequences Far Beyond Epic
The implications are sweeping. Apple is currently fighting or preparing to fight a half-dozen other legal and regulatory challenges — including a high-profile antitrust lawsuit from the U.S. Justice Department, class actions from app developers, and investigations by regulators in the EU, U.K., Spain, and potentially China.
“This will haunt them,” said Stanford law professor Mark Lemley. “In future cases, it will be easier for a judge to conclude Apple is not telling the truth.”
The ruling could also undermine Apple’s defense strategies elsewhere. Courts may now be more inclined to reject Apple’s efforts to seal documents or withhold communications. And testimony from its executives may face greater skepticism.
“This opens the door to judges telling Apple: ‘You’re not going to get away with the games you played before,’” said antitrust lawyer Colin Kass.
A Blow to Apple’s Global Reputation
The ruling may also embolden international regulators. According to Vanderbilt law professor Rebecca Haw Allensworth, authorities in Europe and elsewhere now have firmer ground to act aggressively, citing a pattern of Apple acting in bad faith.
“Apple has been acting like they’re above the law,” she said. “This sends a signal that Apple is not.”
Apple has appealed the contempt ruling and requested a delay in the court’s order, calling the judge’s findings “unwarranted.” The company declined to comment further.
But as legal pressure mounts, Apple’s courtroom credibility — once considered bulletproof — is showing cracks. And those cracks could prove costly in the battles ahead.
