FEDERAL COURT OF AUSTRALIA
Epic Games, Inc v Google LLC (Stay Application) [2022] FCA 66
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Details
- Case
- [2022] FCA 66
- Decision Date
CaseChat Overview and Summary
Epic Games, Inc, the developer of the video game Fortnite, brought proceedings against Google LLC in the Federal Court of Australia, seeking to challenge the removal of Fortnite from the Google Play Store. Google applied for the proceedings to be stayed on the basis that the parties had entered into an agreement that required the litigation to be conducted in California. Epic argued that the exclusive jurisdiction clause in the agreement was contrary to the Competition and Consumer Act 2010 (Cth) and Australian Consumer Law. The court was required to decide whether the exclusive jurisdiction clause was enforceable and whether the court should grant a stay of the proceedings in Australia.
The court considered the enforceability of the exclusive jurisdiction clause under the Competition and Consumer Act and Australian Consumer Law. The court also examined the implications of the mandatory law of the forum, which required the court to apply Australian law to the proceeding. The court found that the exclusive jurisdiction clause was subject to challenge under the Competition and Consumer Act and Australian Consumer Law, and that the mandatory law of the forum applied. The court held that the exclusive jurisdiction clause was not enforceable and that a stay of the proceedings in Australia was not appropriate.
The court dismissed Google's application for a stay of the proceedings and ordered Google to pay Epic's costs of the interlocutory application. The court also granted Epic's application to further amend its originating application and concise statement. The court noted that Google's position on the amendment application was unreasonable and that a departure from the ordinary approach to the question of costs on an amendment application was justified. The court ordered Google to pay Epic's costs of the amendment application, although not on an indemnity basis. If Google wished to discharge that order, it could file a written submission not exceeding 1,000 words within seven days, which the court would consider before troubling Epic.
The court considered the enforceability of the exclusive jurisdiction clause under the Competition and Consumer Act and Australian Consumer Law. The court also examined the implications of the mandatory law of the forum, which required the court to apply Australian law to the proceeding. The court found that the exclusive jurisdiction clause was subject to challenge under the Competition and Consumer Act and Australian Consumer Law, and that the mandatory law of the forum applied. The court held that the exclusive jurisdiction clause was not enforceable and that a stay of the proceedings in Australia was not appropriate.
The court dismissed Google's application for a stay of the proceedings and ordered Google to pay Epic's costs of the interlocutory application. The court also granted Epic's application to further amend its originating application and concise statement. The court noted that Google's position on the amendment application was unreasonable and that a departure from the ordinary approach to the question of costs on an amendment application was justified. The court ordered Google to pay Epic's costs of the amendment application, although not on an indemnity basis. If Google wished to discharge that order, it could file a written submission not exceeding 1,000 words within seven days, which the court would consider before troubling Epic.
Orders
Orders of the court
1. The Respondents’ interlocutory application filed 9 August 2021 be dismissed.
2. The Respondents pay the Applicants’ costs of the interlocutory application.
3. The Applicants have leave to file and serve a Second Amended Originating Application and Second Amended Concise Statement in the form contained in annexures DP-85 and DP-86 to the affidavit of Dave Poddar affirmed 21 October 2021.
4. The Respondents pay the Applicants’ costs of the amendment application.
Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.
Background
Background to the litigation
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Evidence
Evidence Before The Court
A similar case is also pending in this Court: Epic Games, Inc & Anor v Apple Inc & Anor (NSD 1236 of 2020). In that case, Epic also seeks redress for the removal of Fortnite from the Apple App Store. There is a similar, although materially different, exclusive jurisdiction clause involved in that case. Apple applied to stay Epic’s proceeding against it on a similar basis to that which Google now advances. At first instance I granted that stay on a temporary basis: Epic Games, Inc v Apple Inc (Stay Application) [2021] FCA 338; 151 ACSR 444 (‘the Apple Decision’). That decision was reversed by the Full Court which refused the stay application: Epic Games, Inc v Apple Inc [2021] FCAFC 122; 392 ALR 66 (‘the Full Court Apple Decision’). An application for special leave to appeal was refused by the High Court on 2 December 2021: [2021] HCASL 234. The Evidence The evidence consisted of affidavit evidence and some exhibits. Affidavits from the following witnesses were read on the application:·Mr Simon Walter Johnson: Mr Johnson is a partner of Corrs Chambers Westgarth, the solicitors for Google in this proceeding. He explained the operations of each of the Google and Epic entities, the various agreements between Epic and Google and the circumstances surrounding the removal of Fortnite from the Google Play Store. He also gave evidence about the related proceeding which is presently pending before the United States District Court in the Northern District of California (Oakland Division). Mr Johnson prepared an affidavit dated 27 August 2021 and was not cross-examined. ·Judge Jeremy Fogel: Judge Fogel is a retired judge of the United States District Court of California on which he served between 1998 and 2011 in its San Jose Division. As a judge of that court he heard many cases involving technology as well as cases involving anti-trust claims. From 1981 to 1998 Judge Fogel was a judge of the Santa Clara County Municipal and Superior Courts. The docket of those courts was broad and included cases involving technology and anti-trust. Judge Fogel gave expert evidence about the operation under Californian law (including federal law) of the aforementioned agreement between Google Asia, Google LLC and Epic Games. He also gave evidence about how a United States Court would handle Epic’s Australian suit in the event that the present proceeding was stayed and Epic commenced an equivalent proceeding in the United States. Judge Fogel prepared an expert report dated 27 August 2021. He also prepared a further report dated 30 September 2021. This was given in reply to a report prepared by Epic’s expert, Judge Stephen Larson (see below). Judge Fogel was not required for cross-examination.·Mr David Poddar: Mr Poddar is a partner of Clifford Chance, the solicitors for Epic. Like Mr Johnson, Mr Poddar gave some background to the proceedings. This included evidence about the Epic entities, the game Fortnite and the role of GPAL together with some evidence about the various contentions which have passed between the parties during the pendency of the litigation. Mr Poddar prepared two affidavits dated 24 September 2021 and 8 October 2021 and was not required for cross-examination.·Judge Katherine Bolan Forrest: Judge Forrest’s role is as the attorney for Epic in the United States proceedings. Judge Forrest is a retired judge of the United States District Court for the Southern District of New York. It is the practice in the United States to use the honorific ‘Judge’ for retired judges. I will use that honorific even though Judge Forrest’s role is that of an attorney. She gave evidence about the current status of the proceedings against Google in the United States including its consolidation with several other suits concerned with the competitive qualities of the Android platform. She also gave evidence as to what the likely outcome might be if Epic sought to pursue the present proceeding in the United States as well as whether the pursuit of anti-trust claims based on foreign law was common in the United States. Judge Forrest prepared an affidavit dated 24 September 2021 and was not required for cross-examination.·Judge Stephen Larson: Judge Larson is a former judge of the United States District Court for the Central District of California on which he served between 2000 and 2009. He gave evidence on the same issues as Judge Fogel. He prepared a report dated 1 October 2001 and was not required for cross-examination.
Decision
Reasons for decision
For those reasons, I propose to allow the amendments.CONCLUSIONS The Respondents’ stay application will be dismissed with costs. Epic’s application for leave further to amend its Amended Originating Application and Amended Concise Statement is granted. In my view, Google’s position on that application was sufficiently unreasonable to justify a departure from the ordinary approach to the question of costs on an amendment application. I will order Google to pay Epic’s costs of the amendment application although not on an indemnity basis. However, if Google wishes to discharge that order it may file a written submission not exceeding 1,000 words within 7 days which I will consider before troubling Epic.
Ratio Decidendi
Legal Principle Established
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