AppLovin sues Unity over alleged data collection through its Ad Quality SDK

AppLovin has filed for a temporary restraining order against Unity in the Superior Court of California in San Francisco, accusing its rival of harvesting data through Unity’s Ad Quality SDK without permission.

According to a report from Digiday, AppLovin also claims, on an “information and belief” basis, that Unity built that data into models used against AppLovin in live ad auctions, training its own systems on AppLovin’s output to anticipate its bidding decisions.

Unity dismissed AppLovin’s claims as anticompetitive, saying in a statement: “AppLovin’s legal filings against us are a classic case of a dominant incumbent resorting to litigation and intimidation to address increased competition and slowing growth.”

Unity continued: “AppLovin has demanded that we shut down features of a small, free product we operate called Ad Quality. As its name suggests, Ad Quality helps prevent inappropriate and harmful ads from appearing in games. AppLovin clearly believes the data our customers choose to share with us through Ad Quality is driving our sharply improving performance.”

“Despite that performance greatly benefiting our mutual customers, or rather because of it, they will do anything to slow it down. In reality, Ad Quality isn’t the driver of our improved performance, so they’ll be frustrated in that attempt regardless of how this suit is adjudicated.”

AppLovin wants the court to bar Unity from “collecting, intercepting, extracting, using, or disclosing” what it calls “Protected Data,” which is anything tied to auctions AppLovin wins and serves through its MAX mediation platform, including clearing prices, auction and impression IDs, and mediation waterfall data.

It’s also asking for that collection to stop within five business days and that the SDK itself be modified within 30 days, though the order wouldn’t touch data Unity collects from ads it wins and serves itself.

AppLovin has also launched a separate JAMS (Judicial Arbitration and Mediation Services) arbitration against Unity, pursuing claims for breach of contract, trade-secret misappropriation, interference with business relationships, and violations of California’s unfair competition law. It wants the court to act now rather than wait for that process to play out on the basis that the data collection is still happening, and any damage it causes won’t be fixed by an arbitration decision after the fact.

Unity points to AppLovin’s own comparable tool, arguing in correspondence cited in the filing that AppLovin’s Ad Review product, formerly SafeDK, is “far more intrusive” than Ad Quality. AppLovin disputes this, claiming Ad Review only touches impressions mediated through MAX and exists to catch problematic ads, not build profiles or train models.

Court papers show both sides attempted to settle beforehand. AppLovin sent Unity a cease-and-desist in August, and Unity’s response offered to shut off Ad Quality’s data collection from MAX-mediated auctions within five business days. AppLovin turned that down, however, since it only covered going forward and said nothing about data already gathered, any models built from it, or the same collection happening through Unity’s own LevelPlay and Google’s AdMob.

It’s the latest chapter in a rivalry that’s already run through a failed $20bn buyout proposal, an earlier merger attempt, and the fallout from Unity’s Runtime Fee saga. Unity contested AppLovin’s application at a hearing yesterday.