Abstract
Epic Games, the developer of the enormously popular Fortnite, sued Apple for allegedly violating §1 and §2 of the Sherman Act. The central issue was Apple’s requirement that iPhone-compatible apps be purchased in its App Store. Because Apple collects a 30 percent ad valorem tax on each transaction, Epic Games offered an alternative payment option to iPhone owners through the Fortnite app so that consumers could avoid Apple’s 30% fee. When Apple expelled Epic Games from its App Store, Epic sued. In this article, we examine the flawed analysis of the District Court, which can be traced to a fundamental misunderstanding of economic principles.
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