Apple, Inc. AAPL had a key legal victory as the Supreme Court ruled in favor of the company about its anti-steering rules, which prevent app developers from directing consumers to alternate payment methods.
What Happened: Supreme Court Judge Elena Kagan on Wednesday declined to vacate a stay on a lower court order concerning the anti-steering rules in a lawsuit brought by Fortnite developer Epic Games.
After the District Court ordered that Apple violated California's Unfair Competition Law with its anti-steering rules, the Ninth Circuit of Appeals ordered a stay on this part of the ruling in July. Epic sought to vacate the stay because the ruling will impact not only Epic but also consumers and other developers.
If the payment is moved out of the App Store, developers can escape a fee Apple charges but Cupertino reserved the right to charge a commission separately if developers frequently adopt the practice.
See Also: Everything You Need To Know About Apple Stock
Why It's Important: “Big day in Cupertino. Supreme Court decision will allow $AAPL to maintain its anti-steering policies," said Deepwater Asset Management co-founder Gene Munster.
The fund manager sees two benefits for Apple from the ruling. This will help Apple to maintain App Store revenue because it continues developers' challenges in steering customers away from Apple's payment system, he said.
The ruling also reduces the chances that Apple will be forced to make changes to App Store policy or take the rate down the road, he added.
App Store is part of Apple's Services business, which was the start of the June quarter results. The company's quarterly outperformance came mainly due to record revenue earned by the business.
Apple ended Wednesday's session down 0.90% at $178.19 amid the broader market weakness but added a modest 0.13% to $178.43 in the after-hours session, according to Benzinga Pro data.
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