Category: Electronics

ElectronicsExpert WitnessLitigation

Apple v. Epic Games Trial: What You Need To Know

on May 19, 2021

Introduction

Technology giants like Amazon, Facebook, and Google face legal battles yearly. Recently, another behemoth has followed suit (pun intended). On August 13th, 2020, Apple found itself involved in an antitrust lawsuit against Fortnite video game creator, Epic Games. The trial began on May 3rd, 2021 and is ongoing, so this blog post will not have all the answers. As it unfolds, this post will delve into the perspectives of both businesses, describe the nature of the trial, introduce opening statements from the first day of the trial, and explain possible outcomes for both Epic Games and Apple.

Epic Games

Epic Games has filed an antitrust lawsuit against Apple Inc. in response to the removal of its most popular game, Fortnite, from the iPhone App Store. This prohibited 116 million of its 350 million users from updating the game and new consumers from downloading the app (this does not affect the remaining players using other smartphones or gaming consoles). Fortnite’s eradication from iOS App Stores has caused players from around the world to unite in a social media campaign called #FreeFortnite. Epic Games accused the tech giant of monopolizing purchasing options for apps by restricting other methods of conducting transactions. Due to Apple’s renowned international success, Epic Games has filed lawsuits against Apple in Australian, United Kingdom, and European courts. Epic Games not only wants Fortnite back on the iOS App Store, but it also wants to launch a rival App Store on all Apple devices so users can purchase Epic Games products through non-Apple means.

Apple

The catalyst for Fortnite’s removal from Apple’s App Store was the release of a new update by Epic Games which included the implementation of an in-game purchasing currency called “V-Bucks.” This currency allows players to buy items through non-App Store channels. Users who purchase Fortnite items such as outfits, pickaxes, and the latest season’s Battle Pass get to enjoy a 20% discount, which incentivizes players to continue using V-Bucks. Since these purchases are not made through the App Store, V-Bucks circumvents Apple’s chances of receiving its 30% share of any transaction, hence its removal from the App Store and the foundation of #FreeFortnite. In response to Epic Games’ claim of Apple becoming a monopoly, Apple explains the fairness in its decision to remove the game from its App Store. According to Apple, Epic Games violated its agreement by installing V-Bucks without Apple’s permission. If Apple wins the trial, this contract violation could keep Fortnite and all other apps made by Epic Games, or apps run by its game engine, Unreal Engine, from the App Store (The Verge).

The Trial

The trial began on Monday, May 3rd, 2021 in federal court in Oakland, California. This proceeding is a bench trial; thus, the judge will be making the final ruling with no jury. The trial will be held in person and the press and public are prohibited from entering the courtroom. The presiding judge for the United States trial is Judge Yvonne Gonzalez Rogers. Pending trial, she declined Epic Games’ request for Apple to host Fortnite on iOS devices. Trial dates for the international lawsuits against Apple are unknown. However, Epic Games has recently filed lawsuits in November 2020 (Australia), January 2021 (United Kingdom), and February 2021 (Europe).

Opening Statements and Trial Arguments (photo credits from The Verge)

In its opening statement, Epic Games compares Apple’s restrictive policies to a “Walled Garden.” Its argument is based on the unfairness of Apple’s control over purchasing options. Two expert witnesses testified on behalf of Epic Games. University of Chicago economist, Dr. David Evans, told the court, “Apple’s rules unfairly prevent developers from letting consumers know if their prices for in-app purchases take into account the iPhone maker’s 30% commission or that consumers may be able to get better deals elsewhere,” (Wall Street Journal). To add, Susan Athey, an Economics of Technology professor at the Stanford Graduate School of Business, explained Apple’s stronghold over consumers is due to their prohibitive iOS mobile operating system. In the case of this trial, if a consumer wanted to access Fortnite an iPhone, the user would need to switch to a different smartphone brand and repurchase all the apps originally purchased from iOS devices. Since the internet is needed to play Fortnite, Evans highlights how gaming consoles could never replace smartphones, as it lacks cellular data for users who want to play the game from anywhere.

Apple’s opening statement was a defensive response to Epic Games’ claims. According to The Wall Street Journal, Apple hired University of Pennsylvania Wharton School professor, Lorin Hitt, to discuss in-app purchases. Hitt claims, “anticompetitive measures tend to result in reduced quality, yet that hasn’t happened with iPhone and iPads apps, as developers have seen their revenue increase over time.” Essentially, consumers notice the value in the offers proposed by Apple. As noted by the graph below, Mr. Hitt also denounced Epic Games’ claim about Apple’s monopoly-like practices. Users switch devices frequently because people like the products acquired for different reasons. If this were not the case, Play Station and XBOX would not generate over 50% of Fortnite’s revenue for the last two years. This also infers that most Fortnite users are not on iOS devices, which is surprising considering there are 1.5 billion active Apple devices. In addition, Apple insists the iPhone offers multiple avenues for financial transactions. Although difficult to decipher, the second picture provided by Apple indicates that the iPhone, compared to its competitors and subsidiaries, offers three types of digital game transactions options: The App Store, Web Applications, and Purchasing on Other Platforms to play on iOS. Ultimately, Apple is arguing that its practices are not prohibitive nor remotely resemble a “Walled Garden.”

Possible Outcomes

The outcome of the trial between Epic Games and Apple Inc. can end in multiple ways. One hypothetical is the verdict will resume the current situation: users could not access Fortnite on iOS devices, but other games produced by Unreal Engine will remain on Apple’s App Store. If the judge rules in favor of Epic Games, it may be able to create and launch its own App Store on iOS devices.

Legislation

In addition to the trial, a new state bill that recently passed the House 31-29 may negatively impact Apple’s case. According to The Verge, Arizona’s House Bill 2005, “prevents app store operators from forcing a developer based in the state to use a preferred payment system…,” which would ultimately force Apple to provide various payment methods on iOS. This development could be beneficial for Epic Games.

ElectronicsEngineeringExpert Witness

eScooters Recalled Due to Battery Fire Risk: Expert Witness Analysis

on November 6, 2018

In the last week, we learned of a recall involving eScooters. This recall came from Lime, an eScooter and eBike manufacturer. However, this is not the first concern about the safety of eScooters and Lime is not the only manufacturer facing consumer safety concerns.

In big cities throughout the world, transportation is being rapidly impacted by more advanced options than those we typically think about: cars, bikes, and public transportation.

Technologies’ rapid advancement combined with the nightmare of slow-moving automobiles and fighting for parking spaces has made Segways and other eScooters an efficient, environmentally friendly, and fun alternative to normal modes of transportation.

San Francisco is 90 miles from our office. On a good day it takes about 2 hours to make it to the city. Upon arriving, I typically want to find a parking place and avoid getting in the car for the remainder of my time in the city. From my interactions, I am not alone in this feeling. In fact, eScooters are a nice alternative to walking around the city and one I plan on trying in the not too distant future. It will allow me to go greater distances in the city, while being fun (because scooters are fun), and I won’t have to fight the traffic in San Francisco.

As with all consumer products and consumer electronics, especially those new to the market, we start to hear stories about the injuries caused and the safety concerns about the new products. eScooter solutions do not appear to be free from these concerns.

Powered by electronics and lithium-ion batteries, we have learned of the potential for fires related to these scooters. You may recall the “hoverboard” fires from a year or two ago. The hoverboards (self-balancing scooters) were a “hot” purchase at Christmastime and then they experienced recalls as a result of battery failures and battery fires.

Again, these recalls are pretty common for consumer products and from my perspective, companies seem to have drastically improved their response to safety issues and rapidly deploy recalls. I seem to see a recall announcement weekly. It is wise to recall a product and prove your company is proactive regarding customer safety. The alternative today, is suffering the Internet-based attacks for failure to do so. Those attacks are likely to be followed by product liability litigation if your customers are injured.

Lime eScooter Recall:

Last week, I read that Lime had recalled some of their scooters from Los Angeles, San Diego, and Lake Tahoe. TechCrunch, among other news outlets, covered the story. The pertinent part of the story is below, some of which was pulled directly from Lime’s blog:

“‘In several isolated instances, a manufacturing defect could result in the battery smoldering or, in some cases, catching fire,’ Lime wrote on its blog. ‘We took this issue very seriously. Immediately upon learning of the defect, we worked with Segway Ninebot to create a software program to detect the potentially affected batteries. We then worked independently to create an even more thorough software program to ensure that no potentially faulty scooters remained in circulation. When an affected battery was identified — with a red code — we promptly deactivated the scooter so that no members of the public could ride or charge it.’

Lime says it then removed those scooters from circulation and ‘at no time were riders or members of the public put at risk.’ But fast-forward to more ‘recently,’ and Lime has received another report that one of its Segway Ninebot scooters may be vulnerable to battery failure. In total, Lime says less than 0.01 percent of its scooter fleet is affected.”

Given the issues with the hoverboards and now eScooters, I wanted to get a better understanding of the issues impacting electronic scooters and the batteries, as the thread that seems to hold all these stories together, is the lithium-ion batteries.

As such, I reached out to one of our experts for his insights on the matter.

Mechanical Engineering, Medical Device and Consumer Product Expert Witness Dr. T. Kim Parnell:

T. Kim Parnell, PhD, PE, is a Professional Mechanical Engineering consultant with strong experience in a number of technology areas. He holds PhD and MSME degrees from Stanford University in Mechanical Engineering and a BES from Georgia Tech. He specializes in the mechanical engineering design and behavior of Biomedical Devices, Superelastic and Shape Memory Metals (Nitinol), Bioabsorbable Polymers, Composites, Fiber-Reinforced Materials, Electronics, and Consumer Products. Dr. Parnell consults actively in these areas using finite element analysis and other advanced technologies to improve designs, to perform failure analysis, and to improve reliability. To learn more about Dr. Parnell, please visit his website: http://parnell-eng.com/.

Nick: In consumer electronics-based batteries, are their common battery defects that may result in smoldering or the battery catching fire?

Dr. Parnell: Yes, there are several failure modes that can ultimately lead to smoke or fire.

External damage is one mechanism that can lead to failure and smoke or fire. By breaching the external battery package, the reactive internal contents will be exposed to air and moisture.

The failure modes generally involve heat and overheating of the battery in some way.

Some of the heating mechanisms are:

  • External Short Circuit
  • Internal Short Circuit
  • Overcharge
  • Overdischarge
  • External Heating
  • Overheating (self-heating)

Each of these heating mechanisms may ultimately result in battery temperature becoming too high.

The elevated temperature leads to gas generation and additional generation of heat internal to the battery.

If this heat generation exceeds the ability to dissipate the heat, a thermal runaway may occur.

If a thermal runaway occurs, then it may be followed by

  • venting,
  • rupture of the battery container, and then potential
  • fire and explosion.

Nick: The article from TechCrunch explains one battery failed and another caught fire. Does a battery have to catch fire to fail?

Dr. Parnell: No.  Fire is basically an end failure mode.

Nick: Not just in the instance of these scooters, but more generally, is it possible for a battery to be damaged by the charging process rather than a manufacturing defect?

Dr. Parnell: Yes. The battery may be damaged by the charging process.  In particular if the battery is overcharged and if the charge rate remains high after the battery reaches full charge.

Nick: In the article, it seems Lime is able to monitor batteries and detect faulty batteries via software. Can you tell us, in general, how batteries are remotely monitored by consumer electronic companies?

Dr. Parnell: Battery internal temperature is one key parameter that can identify problems.  A temperature sensor from each battery cell can provide data that can be remotely monitored and also can be used locally to isolate a cell.

Nick: Can a battery truly be fixed with a software patch? Or, should the defective battery be removed from operation altogether?

Dr. Parnell: A mechanical battery problem cannot be “fixed” with a software patch.  A problem battery cell in a battery pack may be identified and electrically isolated.

That is what I’ve got for you this week. Although, it has been brought to my attention (thanks to Kevin Gillespie of TextALawyer), that another blog post about the safety issues in and around eScooter use may be necessary. Stay tuned, as there may be a Part 2.

 

ElectronicsExpert WitnessLivestreaming

Livestreaming App is Window into Your Child’s Bedroom: An Experts.com PSA

on July 25, 2018

Law enforcement officers are warning parents about the LiveMe livestreaming application as it allows predators direct access to children, at home, in their bedrooms.

Earlier this week, I was searching for a new story for the blog. It was a long afternoon of reading news stories and not finding any that grabbed my attention.

Then after a while I found this story , from News4Jax, posted by my friend Sergeant Marc Marty, of the Montebello Police Department. Marc is a leader in online safety and the fight against child trafficking. He teaches courses to law enforcement and government officials via LawEnforcement.Social and is active with the Erase Child Trafficking organization.

It hit me, we generally write stories involving expert witnesses, but we only very occasionally write a straight informational, “public service announcement” post. This topic felt like the right topic at the right time.

I’ve been fairly involved with live video since 2015. In fact, live video is how I met Marc. We’ve attended several live video and social media conferences and I watched him speak about online safety and child trafficking at the last mutually attended conference. I’m happy to see he’s still fighting the good fight!

The livestreaming story shared by Marc, is very disconcerting. The app in question, LiveMe, has some 20 million active users. Before this article, I can’t recall hearing about LiveMe. My guess is the app targets minors, so it is not somewhere I wish to spend my personal or professional time. Unfortunately, it is somewhere sexual predators will be quite active.

I imagine law enforcement will also be active on this platform. Unfortunately, with limited resources, dozens of social media platforms, and jurisdictional limitations, police will only be able to monitor a small percentage of the streams and may be limited in their ability to take action. That leaves monitoring to parents, non-profit organizations, and other concerned citizens.

As the News4Jax article describes, several parents were not aware of what their children were doing on this app, in their own bedroom. Others didn’t even know the app existed (admittedly, keeping up with every new platform is difficult).

All of this got me wondering, what viewing behavior is indicative of a predator? Other than monitoring their children and their behaviors, what do parents need to know about online predators? How should they guide their children? What behavior indicates “grooming”? Which children are most at risk?

I reached out to Marc for some greater illumination on the subject.

Sergeant Marc Marty

As I’ve done in the past, I have asked several questions and Marc has provided some spectacular answers on the subject.

Nick: As an officer specializing in social media, what are some steps parents and others can take to prevent predatory use of apps like LiveMe?

Sgt. Marty: Parents first and foremost must develop an open line of communications with their children. Communication is key!! They need to develop a partnership with their children. If parents are “allowing” their child to have a cellphone, they need to explain to their child that it will be monitored and that there may be monitoring software on the phone. Let’s face it, most children cannot purchase a phone, so in essence the phone belongs to the parents, not the child. Be open and honest with your children. Develop a contract with your child that explains and stipulates the rules and guidelines the child must follow in order to have a cellphone. This is important because when the child breaks that contract and their phone gets taken away or they are disciplined, they have a clear understanding why they are being disciplined. This helps develop responsibility.

Nick: Assuming parents are monitoring the livestreaming use of their children, are there any telltale signs that viewers may be predators?

Sgt. Marty: It’s really difficult to determine who is actually watching/following your child online unless you know them. Here’s a question I pose to parents. “Do you let your child have random friends that you know nothing about? Do you let your child talk to just anyone at the mall as they are walking through it?” If the answer is “NO,” then why would you allow a random stranger online follow your child? Parents should know who is following their child online.

Nick: Are there particular signs that a viewer may be “grooming” a potential victim?

Sgt. Marty: If a viewer asks a child to take off their clothes, or to send a random nude photo of them, those are pretty good signs that that person is up to no good. However, predators will often seek weaknesses in children and exploit them. They are looking for the child who wants to run away, or who is upset with their parents, or who doesn’t have parents. They will look for any type of “in” they can find. They will often simply befriend them and develop that digital friendship online.

Nick: Can you share with our readers some basic online safety recommendations?

Sgt. Marty: Children should follow their parents rules at all times. Understand that anything you post online will be there forever. Never send personal pictures to anyone online. Never give out any personal information, such as address, phone number, or other identifying information. Don’t use your name as a screen name online, make up a name. Cyberbullying is huge, don’t respond to any threatening emails, messages posts or texts online. Screen shot the messages, block the individual and immediately notify Facebook, Instagram, or whatever platform you are on, and it will usually be removed right away. You may also need to notify your local police as well. Children should never meet anyone in person unless parents are present and/or notified. Always tell parents, teachers, or other trusted adults of any messages that are unwanted or threatening.

Nick: Is there anything you feel I should have asked that I didn’t ask? Potentially items you feel the public needs to know?

Sgt. Marty: Parents need to understand that social media is the gateway to child trafficking. They need to be able to communicate and educate their children!! They should follow Erase Child Trafficking and any other organization out there that is fighting against the exploitation of children.

Conclusion:

So there you have it, our first or maybe second, true public service post. The topic is hugely important. These are areas where Marc and I have been active for several years and we have seen some of the efforts by strangers to bully and prey on children.

You and your children should enjoy technology. Just do so wisely. Be smart and be safe!