Epic Games has filed another response to Google’s appeal of its guilty verdict in its antitrust trial over how it runs its Google Play Store.
Epic Games, which has been in litigation with Google since the latter (and Apple) removed Epic’s Fortnite Battle Royale game from the Google Play Store after Epic Games filed a lawsuit over antitrust violations in 2020.
“This case is a long-awaited decision. The trial filing is full of evidence of Google’s strategy to suppress competition between app stores and payment solutions in the Android ecosystem, Epic Games said in its legal filing over the weekend. “Internal Google documents clearly detail the “mix of tactics” Google employed because it believed “competition on price…is likely to be a race to the bottom.”
Epic, accusing Google of destroying evidence in the case, added: “Despite Google’s intentional destruction of evidence and its attempted cover-up through what Google’s lawyers called ‘false privilege,’ the lawsuit revealed the multiple ways Google has systematically blocked every avenue for its rivals to compete. »
Google has denied antitrust violations and is appealing its legal loss in court. A year ago, a jury found Google violated antitrust laws when it shut down Epic Games during litigation.
This outcome was different from the antitrust case against Apple, which Epic lost by a wide margin. In this case against Apple, Epic won on one point: app and game developers should be allowed to advertise their alternative stores with lower prices in their apps on the Apple App Store.
But in this case, the jury found that Google illegally linked its app store and billing payment service. Much of the case hinged on evidence related to “Project Hug” deals, in which Google paid game developers not to compete with its app store, which the jury considered anticompetitive.
Among other things, Google required all original equipment manufacturers (OEMs, the companies that make smartphones) that make Android smartphones to prefer its app store (called Google Play) and paid most OEMs for complete exclusivity, Epic said.
Epic alleged that Google required all OEMs to impose technical and other barriers (often called “friction”) to deter users from getting apps outside of Google Play. Google has paid app developers to deny exclusive content from competitors to Google Play, and has paid potential competitors not to launch competing app stores. And after crushing competing app stores, Google required developers using Google Play to also use its own payment solution (called Google Play Billing) for which Google imposed exorbitant fees, Epic said. As a result, only 3% of Android devices in the US managed to install a competing app store. Potential competitors – from small innovators to powerful companies like Amazon – have been sidelined, Epic claimed.
Based on extensive evidence of Google’s wrongdoing, after 15 days of trial, a jury unanimously found Google liable for illegal restraints of trade, monopolization and tying, Epic said.
Following the verdict, the district court conducted a remedial proceeding that lasted several months, with extensive written submissions from the parties, including factual and expert witnesses. The court also held two evidentiary hearings, during which it heard fact witnesses from Google and six expert witnesses. The court then issued an injunction that reflected the comments of both parties, accepting and rejecting some of each party’s proposals. The injunction seeks to stop Google’s illegal conduct and remedy its ongoing negative effects, while allowing Google to compete on the merits. It ends in just three years, Epic said.
On appeal, Google says remarkably little about the conduct in which it engaged. Rather, it laments the fact that in a different case with a different record regarding different behavior from another company (Apple), the outcome was partially different, Epic alleged.
Epic alleged that Google’s attacks on the district court’s injunction were also wrong. When a defendant violates antitrust laws, courts have broad discretion to craft remedies that will stop the illegal conduct and deprive the violator of the continued fruits of its misconduct, Epic said. The district court exercised this discretion thoughtfully, taking into account the seriousness and widespread impact of Google’s violations, raised by sensitivity to the risks of intervention, Epic said.
Google’s claim that the district court “disregarded” potential security concerns (Br.82) is also incorrect. The court expressly stated that “some of the remedies carry potential security and technical risks” and allowed Google “to engage in its normal security and safety processes.”
Epic said the trial evidence, however, showed that Google abused security justifications as a pretext to impose anticompetitive restrictions, and the jury necessarily concluded that the security justifications advanced by Google were outweighed by the anticompetitive effects.
Thus, Epic said the district court reasonably imposed limits on future invocations of “security” by Google as a basis for resisting challenges (requiring Google to demonstrate that limits on third-party app stores “were strictly necessary to ensuring the safety and security of users and developers). Additionally, the district court had a record establishing that Google’s security concerns were overblown, Epic said.
Epic Games told the appeals court that the district court’s judgment should be upheld. Furthermore, because Google has no chance of success on the merits, its stay motion should be denied quickly, allowing the injunction to begin benefiting consumers and developers while the court prepares its full opinion, said Epic.
We’ll see what Google’s comments are in response.
