Apple In Major Trouble With The Department Of Justice?
Apple is in some serious hot water with the United States Department of Justice. The agency is suing the tech giant on grounds of antitrust.
Facebook and Google have come under fire for their antitrust violations over the past several years, but these two tech giants aren’t the only companies infringing on the law. Apple and the Department of Justice are conflicting based on antitrust allegations, with the DOJ claiming that Apple “abused its market power” to squash smaller competition.
Though Apple has had various lawsuits from states and individuals, this would be the company’s first federal case by a government agency. Other countries have raised similar concerns about Apple’s App Store fees, but this would be its first federal suit in the US. This comes at a time when the tech company recently warded off a guilty indictment from a civil case with Epic Games. The video game company claimed that Apple was unjustly monopolizing the online app store market, but the judge concluded that Apple wasn’t violating antitrust regulations.
So far, no action against Apple has been placed by the Department of Justice. The DOJ may consider dropping the whole case altogether, though it’s not likely. Even if the US department claims Apple, it may take years before the suit is properly filed. All the public has is the DOJ’s sense of urgency and its decision to draft the case, showcasing the legitimacy of the agency’s actions. If the department goes forward with filing, Apple could be in deep trouble with federal law.
Antitrust regulations and laws that promote healthy competition without monopolization have been a supreme focus in recent social media court cases. Facebook, Google, and Apple have been significantly scrutinized for their marketplace dominations. Facebook’s parent company Meta recently dealt with a lawsuit filed by the Federal Trade Commission, attempting to block the company’s acquisition of the VR company Within. The FTC voted to sue the company to stop Meta’s monopolization of VR equipment and fitness apps.
Google has also had numerous antitrust lawsuits claiming that the tech company was negating marketplace competition. In 2020, the Department of Justice filed antitrust charges against the tech giant, claiming that Google was monopolizing display ad businesses. To circumvent the problem, Google offered to split its ad businesses into separate enterprises. The company also revealed other solutions to the issue, hoping to stop the DOJ from furthering its suit. It’s unclear if the move has warded off the impending decision or if the DOJ has backed off from its antitrust allegations. Apple may have to shuffle its business ventures around to eliminate the threat of federal court cases.
Though the likelihood of a DOJ lawsuit against Apple grows more evident, Evercore ISI analyst Amit Daryanani believes that the tech giant can handle such a substantial case. Daryanani claims that Apple will be able to combat an App Store-focused action since it’s been successful in past endeavors to protect the store’s legality. The most worrying part of the case would be the “headline risk” and the media circulating the federal lawsuit news. Though Apple has the resources to handle a significant lawsuit, the attention may hinder the loyalty of its dedicated consumer base.
