Apple’s Legal Setback: Ninth Circuit Denies Rehearing in Epic Games Dispute
In a significant development in the ongoing legal battle between Apple Inc. and Epic Games, the U.S. Court of Appeals for the Ninth Circuit has denied Apple’s petitions for both panel rehearing and rehearing en banc. This decision effectively upholds the previous ruling that found Apple in violation of California’s Unfair Competition Law by restricting developers from directing users to alternative payment methods.
Background of the Dispute
The conflict began in August 2020 when Epic Games introduced a direct payment system within its popular game, Fortnite, circumventing Apple’s in-app purchase mechanism. This move led to Fortnite’s removal from the App Store and prompted Epic to file a lawsuit against Apple, challenging the tech giant’s control over app distribution and in-app purchases.
Over the course of the litigation, courts dismissed many of Epic’s claims but identified that Apple’s anti-steering provisions—rules preventing developers from informing users about alternative payment options—violated state competition laws. As a result, Apple was ordered to allow developers to include links and information about external payment methods within their apps.
Apple’s Response and Legal Maneuvers
In response to the court’s directive, Apple implemented changes to its App Store policies. However, the company also introduced a 27% commission on purchases made through external links, a move that Epic Games and other developers criticized as undermining the spirit of the court’s ruling. Apple contended that this commission was necessary to compensate for the use of its platform and services.
Seeking to overturn the unfavorable aspects of the ruling, Apple filed petitions for a panel rehearing and a rehearing en banc with the Ninth Circuit. A panel rehearing involves the same judges who issued the original decision reviewing the case, while a rehearing en banc entails a larger group of judges from the circuit court reconsidering the matter.
Ninth Circuit’s Decision
On March 31, 2026, the Ninth Circuit denied both of Apple’s petitions. The court’s order stated:
> The full court has been advised of the petition for rehearing en banc, and no judge of the court has requested a vote on it. The petition for panel rehearing and the petition for rehearing en banc are DENIED.
This denial signifies that the appellate court stands by its previous decision, leaving Apple with limited avenues for further appeal.
Implications for Apple and the App Store
With the Ninth Circuit’s denial, Apple faces increased pressure to comply fully with the court’s injunction. The company must allow developers to inform users about and link to alternative payment methods without imposing additional fees that could be perceived as punitive.
This ruling could have broader implications for Apple’s App Store policies and its business model, which has traditionally relied on a 30% commission from in-app purchases. Developers may now have more leverage to negotiate terms and offer alternative payment options, potentially leading to increased competition and innovation within the app ecosystem.
Potential Next Steps for Apple
Given the Ninth Circuit’s decision, Apple’s remaining option is to petition the U.S. Supreme Court to review the case. However, the Supreme Court accepts a limited number of cases each year, and there is no guarantee that it would agree to hear this dispute.
In the meantime, Apple may need to reassess its App Store policies to ensure compliance with the court’s ruling and to maintain its relationships with developers. Failure to do so could result in further legal challenges and potential regulatory scrutiny.
Broader Industry Impact
The outcome of this case is being closely watched by the tech industry, as it addresses fundamental questions about platform control, competition, and the rights of developers. Other platform operators may need to reevaluate their policies in light of this decision to avoid similar legal challenges.
For consumers, the ruling could lead to more choices and potentially lower prices, as developers may pass on savings from reduced commission fees. However, it also raises questions about the sustainability of app marketplaces and the funding of platform services.
Conclusion
The Ninth Circuit’s denial of Apple’s rehearing petitions marks a pivotal moment in the company’s legal battle with Epic Games. As Apple considers its next steps, the tech industry awaits the potential ripple effects of this decision on app store policies, developer relations, and the broader digital marketplace.
