Google has filed a new motion to the court in its antitrust battle with Epic Games and Match Group, where it claims that the dating app maker owes additional fees beyond the $40 million that had been previously set aside in escrow. Those funds are Google’s cut of Match’s in-app payments on Google Play that Match argues are “illegal under federal and state law” — something the court case will decide. By Google’s calculations, the new figure should total around $84 million instead, based on Match’s public earnings.
The relevant portion of the filing reads as follows:
Google and Match reached a stipulation in May 2022 resolving a TRO that Match filed in this case. Dkt. 21, No. 3:22-cv-02746-JD. That stipulation allowed Match to continue distributing its apps through the Play store despite its noncompliance with Google’s payments policies, provided that, among other things, Match pay $40 million in payments to escrow. While those payments have now ended, the service fees that Match owes Google substantially exceed that amount. See Match Group Letter to Shareholders, Q1 2022, at 9, 10, https://s22.q4cdn.com/279430125/files/doc_financials/2022/q1/Earnings-Letter-Q1-2022-vF.pdf (noting negative financial impact from Google’s requirement to use its payment system). Google intends to try its counterclaims to recover the full amount it is owed.
The escrow account was one of a handful of concessions from Google to get Match to drop a temporary restraining order it filed after first suing Google, accusing the tech giant of wielding unfair monopoly power in its mobile app marketplace, the Google Play Store. Google also committed to not rejecting or deleting Match-owned dating apps like Tinder, Hinge, OkCupid and others from the Play Store for providing alternative payment options.
As part of this agreement, Match was to place up to $40 million in the escrow account in lieu of paying fees directly to Google for the in-app payments that take place outside of Google Play’s own payment system while the courts decide whether or not the commissions Google charges app developers on in-app purchases are legal.
But in the new filing, Google argues $40 million is not enough, citing Match’s public earnings. It points to the dating app maker’s shareholder letter for Q2 2022 where the company notes that “While our Q2 Adjusted Operating Income outlook includes an estimated $6 million of negative impact from Google’s policy change beginning June 1st, we need to see the actual effects once the change is implemented.”
Google says that $6 million is what Match owes in fees, but the lawsuit paused the payments. Based on this figure, Google estimates Match owes fees of $6 million per month for the past 14 months, which would total $84 million in fees. That exceeds the $40 million held in escrow, so Google is now planning to try to recover a higher amount in its counterclaims.
“While those payments have now ended, the service fees that Match owes Google substantially exceed that amount,” the filing explains. “Google intends to try its counterclaims to recover the full amount it is owed.”
Match declined to comment.