Topline
The Department of Justice is preparing a preliminary draft of its antitrust lawsuit against Apple though it has not definitively decided to follow through with the suit, Politico reported Friday, setting the stage for an epic legal battle for the world’s largest company long accused of stifling competition.
The App Store has long been the focus of monopoly accusations against Apple.
Key Facts
Though the Justice Department has yet to make a final decision on if they will file the lawsuit, prosecutors intend to file the suit by the end of the year if they do pursue the case, Politico reported, citing a person familiar with the matter.
The suit targets Apple’s App Store practices – behavior decried by rivals as anticompetitive – as well as allegations related to the company’s hardware, according to the report.
Apple shares fell 1.1% to $164.61 following the report, furthering a 3.1% decline in Friday trading.
Apple, which has previously denied engaging in monopolistic practices, didn’t respond to Forbes’ request for comment, while the Justice Department declined to comment.
Key Background
The Justice Department’s antitrust division has been investigating Apple since 2019, and the Information reported last October the likelihood of the probe resulting in a lawsuit was rising. Apple would join fellow technology giants Alphabet and Meta in facing federal antitrust suits, as Alphabet’s Google and Meta’s Facebook were sued by the Justice Department and Federal Trade Commission, respectively, in 2020 for alleged monopolistic practices. Critics denounced Apple’s long standing policy of taking a 30% cut on most purchases made on the App Store, though Apple altered the policy last August amid a high-profile antitrust lawsuit against the company by Epic Games. and an October 2020 investigation by the House antitrust subcommittee found Apple has “monopoly power” over the smartphone app market.
Big Number
$2.65 trillion. That’s the market capitalization of Apple, the biggest of any company in the world.
Further Reading
DOJ in early stages of drafting possible antitrust suit against Apple (Politico)
Source: https://www.forbes.com/sites/dereksaul/2022/08/26/feds-reportedly-preparing-antitrust-suit-against-apple/