Apple is facing mounting pressure in legal disputes over App Store payment fees and promotion of its artificial intelligence (AI) features. It failed to clear the U.S. Supreme Court hurdle in its app payment fee lawsuit with Epic Games, Inc., and agreed to a $250 million settlement in a consumer class action over iPhone AI feature advertising.
On the 6th local time, Reuters reported that the U.S. Supreme Court declined Apple's request to pause the effect of a lower court ruling in the Epic Games, Inc. case. The court had previously found that Apple must allow app developers to direct users to external payment methods. Apple, however, applied fees of up to 27% to external payments, and Epic Games, Inc. argued this effectively sidestepped the court's order.
The appellate court acknowledged that Apple can charge certain fees on external payments, but found it inappropriate that the level remained largely indistinguishable from existing in-app purchase fees. With the Supreme Court rejecting Apple's request, Apple now returns to the trial court to contest the reasonableness of its external payment fees. Because App Store fees are a key revenue base for Apple's services business, the decision could affect its future revenue structure.
The situation also contrasts with rival Google, which recently settled with Epic Games, Inc., moving to lower app payment fees and allow external payments. Apple is continuing legal action to protect its control over the App Store, but as global regulation and developer pushback grow, it will be difficult to maintain its existing policies as is.
Controversy over AI features is also continuing. According to the Associated Press, Apple agreed to settle for $250 million a consumer class action alleging that AI features related to "Apple Intelligence" and Siri were marketed in an exaggerated way compared to reality. Apple unveiled new AI features in a major rollout at the 2024 Worldwide Developers Conference, but some features were delayed or not applied to products in time.
If approved by the court, consumers in the United States who purchased any iPhone 16 model and certain iPhone 15 models during a specified period could receive $25 to $95 per device. Apple maintains it has not admitted liability, but the case shows that delays in launching AI features can translate into brand trust issues and consumer lawsuits. The App Store and AI are the core pillars supporting Apple's growth strategy. With legal pressure rising on both fronts, Apple's closed-platform strategy is also being put to the test.