Epic Games, Inc. v. Google LLC

Background

This order explains the permanent injunction to be entered in Epic’s case against Google and resolves Epic’s remaining equitable claim under California’s Unfair Competition Law (UCL). In an earlier order, the Court described a unanimous jury verdict finding Google liable for monopolization under Section 2 of the Sherman Act; unlawful restraint of trade under Section 1 of the Sherman Act and the California Cartwright Act; and tying under Section 1 of the Sherman Act and the Cartwright Act.

The Court held extensive post-verdict proceedings about the appropriate remedy, including expert hearings involving economists, technology experts, and Google engineers. Epic sought an injunction, and Google filed objections to Epic’s proposal.

UCL Claim

The UCL prohibits unlawful, unfair, or fraudulent business practices. Epic alleged violations of the unlawful and unfair prongs. The Court held that the jury’s findings of Sherman Act and Cartwright Act violations necessarily established a violation of the UCL’s unlawful prong because the UCL treats violations of other laws as unlawful business practices.

The Court also held that Google violated the UCL’s unfairness prong. It reasoned that the jury found Google’s conduct violated antitrust laws, substantially harmed competition, and directly injured Epic, while rejecting Google’s proposed procompetitive justifications. The Court entered judgment in Epic’s favor on the UCL claim.

Injunction Standards and Scope

The Court applied Section 16 of the Clayton Act and traditional equitable-remedy principles. It concluded that Epic had shown irreparable injury, that money damages were inadequate, that the balance of hardships supported equitable relief, and that the public interest favored restoring competition. The Court found that Google’s conduct had foreclosed Epic from using its own in-app billing services while distributing Fortnite through Google Play and had foreclosed Epic from competing in the market for Android in-app billing services for digital goods and services transactions.

The injunction’s scope is coterminous with the relief for the federal and state antitrust violations and the UCL violations. The Court declined to extend the injunction to conduct outside the United States, citing respect for other countries’ authority to enforce their own antitrust laws.

The injunction prohibits Google from sharing Play Store revenue with current or potential Android app-store rivals and from using contractual terms that condition benefits on promises intended to secure Play Store exclusivity. Those prohibitions last three years. The injunction also requires Google to provide rival app stores access to the Google Play Store app catalog for three years and prevents Google from prohibiting the presence of rival app stores in the Play Store, subject to security and technical requirements.

The injunction prohibits Google from requiring developers to use Google Play Billing for apps distributed through the Google Play Store. The Court declined to impose an additional provision addressing what Epic called an economic tie because the remedy for the monopoly violation would also address the tying violation. The injunction includes a Technical Committee to address technical issues initially, with the Court resolving issues the committee cannot resolve.

Disposition

The Court stated that a permanent injunction would be entered against Google for Epic’s Sherman Act, Cartwright Act, and UCL claims. The injunction’s effective date is November 1, 2024, to allow Google time to bring its current agreements and practices into compliance. After attorney’s fees and costs are awarded, judgment will be entered for Epic on those claims, and the member case will be closed.