At present, Tim Sweeney is attempting to mislead his audience regarding discoveries that Epic requested a special exemption from Apple’s terms of service, as to allow them to implement their separate payment system. In line with his current persona of the champion of the little guy, he is claiming Apple is attempting to mislead people and that they asked for exceptions for everyone.
“We hope that Apple will reflect on its platform restrictions and begin to make historic changes that bring to the world’s billion iOS consumers the rights and freedoms enjoyed on the world’s leading open computing platforms including Windows and macOS.” pic.twitter.com/cRJRO8dQbG
— Tim Sweeney (@TimSweeneyEpic) August 21, 2020
https://platform.twitter.com/widgets.js
How noble. But as you can see from Apple’s filing below, that is not what they are alleging. Apple states on June 30th, Epic emailed Apple requesting an exception to allow them to implement their own payment processor. Upon review, the request was denied. According to Apple, they do not create special exceptions to their rules, and so Epic’s request to have a payment processor separate from the iTunes App Store ecosystem was denied. They then warned Epic that if they proceeded with implementing an independent payment system their game would be pulled for the storefront.
Epic proceeded to ignore Apple’s warning. Or rather, they took heed to it as they later attempted to sneak their new payment system by the review process. This was accomplished by processing the payments through Epic’s servers to avoid detection by Apple.
The rest of the filing states that Epic, in undertaking these actions, fully understood they were violating Apple’s Terms of Service in a calculated fashion. Most outlets are latching onto the news that they requested special exemption while ignoring that in the complete context, this is used to accuse Epic of malpractice.
Tim Sweeney is fully aware of this as CEO, but has opted to omit the rest of what was said. Instead, he has focused his attention on the statement of the request for exemption, rather than the context in which the statement lies. It could be argued this is a lie by omission, but what Sweeney is attempting is to do damage control for his and his companies now ailing image.
D. Epic’s Decision to Breach Its Agreements
On June 30, 2020, Epic emailed Apple requesting to offer a competing Epic Games Store app through the App Store that would allow iOS device users to install apps from Epic directly, rather than through the App Store and to offer payment processing options within Epic’s apps other than IAP. Schiller Decl. ¶ 8, Ex. D. On July 10, Apple responded that “Apple has never allowed this . . . we strongly believe these rules are vital to the health of the Apple platform and carry enormous benefits for both consumers and developers.” Schiller Decl. ¶ 9, Ex. E at 4.
Despite this warning, on August 13, 2020, Epic made a deliberate choice to cheat Apple. See Epic’s Motion for a Temporary Restraining Order, Dkt. 17 (“TRO Br.”) at 8-9. Around 2am on August 13, Mr. Sweeney of Epic wrote to Apple stating its intent to breach Epic’s agreements: “Epic will no longer adhere to Apple’s payment processing restrictions.” Schiller Decl. ¶ 11. Hours later, Epic activated a secretly planted payment mechanism in Fortnite to slide a non-approved change into the app that blatantly evaded App Review. TRO Br. at 9; Schiller Decl. ¶¶ 11-12. In order to deliberately conceal the change from Apple, Epic changed the option on its own servers to enable the approved version of Fortnite to offer a non-compliant in-app purchase option. TRO Br. At 9.
Epic’s breach was flagrant. Epic willfully “direct[ed] customers to purchasing mechanisms other than in-app purchase” and created a new “storefront” in contravention of the Guidelines. Schiller Decl., Ex. C ¶¶ 3.1.1, 3.2.1. 12 This is “egregious behavior” prohibited under the agreements that “can lead to removal from the Apple Developer Program.” Schiller Decl., Ex. H. Epic breached the License Agreement, Ex. F, by making changes without resubmission to Apple (¶ 6.1), installing a store or storefront (¶ 3.3.2), enabling purchases without using the In-App Purchase API (¶ 3.3.25), and more. Schiller Decl., Ex. I.
Epic knew full well that, in circumventing Apple’s processes and breaching its contracts, it was putting its entire relationship with Apple—including its Unreal Engine and other projects—at serious risk. Epic made the calculated decision to breach anyway, and then run to this Court to argue that its customers were being damaged. All of this was avoidable if Epic had brought its antitrust case without breaching its agreements. It is hard to think of a case less worthy of the extraordinary relief that Epic seeks.
