Apple Says ‘Epic’s Conduct Threatens the Very Existence of the iOS Ecosystem’ in Countersuit

The showdown between Apple and Epic Games shows no signs of being over. Apple filed its countersuit today against the Fortnite maker, seeking compensatory and punitive damages in addition to asking the court to hold Epic accountable for its contractual obligations with Apple.

“Epic’s actions have caused Apple to suffer reputational harm and loss of goodwill with consumers who rely on Apple to offer the apps they want to download, like Fortnite, with all of the safety, security, and privacy protections that they expect from Apple,” Apple said in its filing. “Left unchecked, Epic’s conduct threatens the very existence of the iOS ecosystem and its tremendous value to consumers.”

Apple claimed that Epic purposefully sent a “Trojan horse” to the App Store, hiding a line of code in a Fortnite hotfix that allowed the gaming company to “bypass Apple’s app review process” so it could trigger the option for users to pay Epic directly for V-Bucks, the game’s currency. Epic has denied that it hid anything from Apple.

Apple said this hotfix amounted to “little more than theft,” claiming that Epic purposefully tried to find a way to “enjoy all of the benefits of Apple’s iOS platform and related services” without paying Apple what it contractually owed.

“Apple rightfully enforced its rights under the contractual agreements and the guidelines by removing the non-compliant Fortnite app from the App Store,” Apple said. “In keeping with its self-serving narrative, Epic attempts to recast Apple’s conduct as ‘retaliation.’ But the exercise of a contractual right in response to an open and admitted breach is not ‘retaliation.’”

Apple points to an email from Epic Games CEO Tim Sweeney that was sent at 2 a.m. on Aug. 13, in which Sweeney wrote, “Epic will no longer adhere to Apple’s payment processing restrictions,” and that the company would begin offering a direct payment method on its Fortnite macOS and iOS apps.

According to Apple, that move is proof Epic’s lawsuit was an “orchestrated legal and public relations strategy to avoid the commissions to which Apple is contractually entitled” and that Epic has not contested that it breached its contract with Apple. The same day that Epic announced it implemented a direct payment option, Apple removed Fortnite from the App Store, therefore freeing Epic Games from those “payment processing restrictions.”

It doesn’t seem like Epic actually stole from Apple, given that the company pretty clearly planned for Apple to respond to its move by booting Fortnite from the App Store. I mean, Sweeney’s email was effectively: “Hey, just a heads up, that 30% thing? Yeah, we’re not gonna pay that anymore.” And the commercial Epic released afterwards seems to reaffirm that the company knew exactly the domino effect its move would have—and intended to have.

Last week, Epic Games filed a preliminary injunction with the U.S. District Court for the Northern District of California to put Fortnite back on the App Store while it continues its legal battle with Apple. The company already won a temporary restraining order against Apple, preventing the tech giant from booting Epic’s Unreal Engine gaming platform from the App Store in addition to Fortnite. In an earlier hearing, Apple said it believed Epic would violate its Unreal Engine contract and it was taking precautionary measures to prevent that by removing Unreal Engine. However, because Epic maintains separate contracts with Apple for both Fortnite and Unreal, and because Epic had not violated its Unreal contract, the judge saw no reason to allow Apple to remove it—never mind the countless number of game developers and filmmakers that rely on Unreal to make their products.

That was one of the major talking points in Epic’s filing last week, because the fate of Unreal is still in question. The TRO that was partially granted in Epic’s favor last month only maintains the status quo until after the preliminary hearing. Depending on how that goes, it’s possible that Unreal Engine will join Fortnite in App Store purgatory—which means developers and filmmakers currently working on games or movies might not have access to the tools they need to perform updates on their products or possibly continue their work.

Further down the road, this could mean those creators would have to switch to a different engine, like Unity, or forgo creating for macOS and iOS all together. That would put games like Dodo Peak, which was created with Unreal and was one of the first games to launch on Apple Arcade, in jeopardy.

Epic Games has until Sept. 18 to respond to Apple’s countersuit. The next hearing is scheduled for Sept. 28.