NEWS

ACCC Playing Watchdog Against Apple Over Fortnite

The Australian Competition and Consumer Commission (ACCC) has taken a watchful eye over the conduct of Apple in the matter of Epic Games, Inc v Apple Inc [2021] FCA 338, a stay application brought by Apple in which it seeks that the dispute be determined by Californian Courts.

Background

In late 2020, Epic Games commenced proceedings against Apple seeking injunctions restraining Apple from contravening sections of the Competition and Consumer Act 2010 (Cth) (‘the Act’). Epic had alleged that one of the breaches by Apple was by its decision to remove the popular videogame ‘Fortnite’ from the Apple App Store. Epic had argued that Apple was in breach of the Act by preventing alternative app stores on the IOS platform operating system from administering the game, given that the Apple App Store is the only app store available to users of Apple products. Epic had, previously that year, commenced similar proceedings against Apple in the United States Court.

The problem? – Epic was in a contractual agreement with Apple, the terms of which stated that any disputes between the parties is to be litigated in the Northern District of California. Apple subsequently brought a stay application in the Australian proceedings for the dispute to be determined in America, which was granted, and the decision has been appealed by Epic. A problem indeed.

ACCC Intervention

Noting the potentially huge impact such a decision could have on the Australian consumer law landscape, the ACCC has sought leave to appear at the hearing as an amicus curiae (‘a friend of the court’) to make non-party submissions in favour of keeping Australian consumer law disputes in house, that is, litigated on Australian soil and under Australian jurisdiction.

The ACCC’s reasoning, according to Chair Rod Sims, was two fold. Firstly, the dispute involves Australian consumers in an Australian court. The ACCC believes it is in the interests of the Australian public to have a significant case such as this heard in Australia given the potential implications for Australian consumers should the dispute be transferred to an American jurisdiction.

Secondly, as the leading watchdog for consumer laws and regulations in Australia, the ACCC argues that it would be of valuable assistance to the Court should it be permitted to make submissions.

What does this mean?

If granted permission to act as an amicus curiae, the ACCC would likely support Epic in seeking to agitate the matter before the Court in Australia . After all, even Perram J at [64] concluded that whilst he did not consider that the state of the law concerning the choice of forum clauses permitted him to refuse Apple’s application, he was “deeply troubled in acceding to it”.

In seeking leave, the ACCC understands the undoubtedly concerning ramifications should Apple’s decision be upheld, which could see large international megacompanies effectively “contract out” of Australian consumer law provisions by entering into choice of foreign forum agreements.

The watchdog continues its watch.

The content of this article is intended to provide a general guide to the subject matter. Specific advice should be sought about your specific circumstances.

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