Valve have rejected a subpoena from Apple demanding information on Steam sales and operations for six years, in the ongoing Epic Games vs. Apple lawsuit.
PC Gamer reports a joint discovery letter was filed to the District Court of Northern California regarding the subpoena made in November 2020.
The letter explains Apple’s position that Valve’s Steam store is “the dominant digital game distributor on the PC platform and is a
direct competitor to the Epic Game Store.” Apple argue that Epic Games could sell Fortnite on Steam, and as such made a subpoena.
Apple had requested Valve produce “(a) total yearly sales of apps and in-app products; (b) annual advertising revenues from Steam; (c) annual sales of external products attributable to Steam; (d) annual revenues from Steam; and (e) annual earnings (whether gross or net) from Steam.”
They claim this information “is crucial for calculating the total size of the market for Epic’s available digital distribution channels, which this Court already has found highly relevant to this case.” This was due to the case requiring Apple to prove “the strength of competition for consumers and app developers” among online store.
In addition, Apple demanded “(a) the name of each App on Steam; (b) the date range when the App was available on Steam; and (c) the price of the App and any in-app product available on Steam.” Apple claim this would help them “determine the scope and breadth of the digital distribution marketplace,” and part of them proving the strength of the competition.
The letter claims Apple and Valve “engaged in several meet and confers,” but Valve would ultimately refuse to provide the requested information. Valve did state that the information requested is available in “some undisclosed, readily accessible format, but generically claims it won’t produce the information because it is confidential or too burdensome to gather in the manner Apple requested.”
What documents Valve did sent to Apple were so heavily redacted they they were of no use. In the letter, Valve argues that they do not make or sell phones, tablets, games for those platforms, or compete in the mobile gaming market. Further, 99% of the over 30,000 games on their platform are from third parties; who determine the games’ prices and content.
Valve claim the documents they did send were not of satisfaction to Apple; and further demands “without offering to cover Valve’s costs, which would be significant—that Valve (i) recreate six years’ worth of PC game and item sales for hundreds of third party video games, then (ii) produce a massive amount of confidential information about these games and Valve’s revenues. “
Valve denied this request, further adding Apple narrowed their reques to information on 436 games that are available on both Steam and the Epic Games Store. This data would have been (from 2015) all sales, price changes, gross revenues, and all revenue related to every version of those games and all digital content or items.
Along with being a massive burden to Valve, Valve state this would involve gathering data they do not keep records on. Valve further argued Apple did not provide sufficient proof they needed that evidence in their case. Along with Valve stating they do not compete in the mobile gaming space, and that Apple had contradicted themselves within the trial.
“Apple’s latest market definition argument is contradicted by its prior ones. When opposing a preliminary injunction, Apple argued the relevant market included “competing platforms on which Fortnite is distributed and monetized.” (Case No. 20-cv-05640-YGR) (Dkt.118 at 16). Later, in seeking to compel Samsung, this Court noted that “Apple firmly takes the view that in the Epic case, the relevant market is Epic alone.” Id. (Dkt. 296 at 4). Valve is not in either of these markets—Valve is not Epic, and Fortnite is not available on Steam.”
Valve further argued that the sought information would not show market size or definition, that the court had rejected Apple’s requests of Epic sales information from Samsung, and that much of the information would be held by third parties. The latter would involve Valve violating the privacy of those companies.
“Somehow, in a dispute over mobile apps, a maker of PC games that does not compete in the mobile market or sell ‘apps’ is being portrayed as a key figure. It’s not. The extensive and highly confidential information Apple demands about a subset of the PC games available on Steam does not show the size or parameters of the relevant market and would be massively burdensome to pull together. Apple’s demands for further production should be rejected.”
As we previously reported, Epic Games announced that the price of V-Bucks, Fornite‘s in-game currency that can be bought with real money, would permanently be 20% cheaper on all platforms. However, on Android and iOS, a new payment method was introduced.
Rather than buying the V-Bucks through Google Play and the App Store respectively, Epic Games launched the “Epic direct payment.” “When you choose to use Epic direct payments,” the announcement explains, “you save up to 20% as Epic passes along payment processing savings to you.”
This is due to Apple and Google collecting a 30% fee through all V-Bucks bought on their respective platforms. As such, the 20% drop has not been applied to purchases made through them. Epic Games state that “If Apple or Google lower their fees on payments in the future, Epic will pass along the savings to you.”
Shortly after this announcement, Apple and Google both removed Fortnite from the App Store and Google Play Stores respectively due to Epic Games violating their terms of service.
Epic Games issued legal action against both, citing that they had a monopoly over their stores on iOS and Android. Apple had allegedly threatened to terminate all of Epic Games’ App Store developer accounts and cut off tools for development on iOS and Mac.
Epic Games may have been expecting action from Apple however, having made a parody of Apple’s own 1984 commercial; appealing to their fans to support them. Further, the #FreeFortnite Cup was announced.
Apple later accused Sweeney of asking for exception from the App Store terms and conditions. Sweeney tweeted that Apple’s statement was misleading, and presented screenshots of the alleged emails. Microsoft also filed a statement of support, favoring Epic Games.
In late August, Apple terminated Epic Games’ App Store developer account. This means Epic Games will no longer be able to submit new apps, or updates to existing ones (such as the Infinity Blade games).
Epic would successfully win a restraining order that month, denying Apple removing Unreal Engine-based games from the App Store (thereby harming developers who used the engine for their games). Epic Games later filed an injunction asking that Apple be prohibited from “taking any adverse action against Epic.”
In early September of this year, Apple issued a counter-suit against Epic Games. Therein they asked for compensation and damages, claiming Epic Games’ actions were “little more than theft.” Both parties would later agree to a trial by judge, rather than a jury. That trial is set for May 3rd, 2021.
Judge Yvonne Gonzales Rogers gave a preliminary injunction in October. Apple did not have to reinstate Fortnite on the App store, but they had a restraining order preventing them from revoking developer tools from “Epic Affiliates;” such as those using the Unreal Engine for their game.
Judge Gonzales Rogers later dismissed two of Apple’s claims at a hearing on November 10th, including their claim of Epic Games committing theft. She told Apple lawyer Anna Casey “You can’t just say it’s independently wrongful. You actually have to have facts.”
Sweeney recently drew ire for comparing the Epic Games vs. Apple lawsuit to the civil rights movement. Epic Games also reportedly hired a lobbyist to propose a bill in North Dakota, that would allow alternate payment methods on the App Store and Google Play.
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