Great Lakes Wire

The U.S. Department of Justice, in collaboration with 16 state and district Attorneys General, including Michigan Attorney General Dana Nessel, has initiated a civil antitrust lawsuit against Apple. The lawsuit accuses the tech giant of monopolizing smartphone markets, allegedly violating Section 2 of the Sherman Act.

Filed in the United States District Court for the District of New Jersey, the complaint asserts that Apple maintains its monopoly over smartphones by imposing selective contractual restrictions and withholding critical access points from developers. These actions are said to undermine applications, products, and services that could promote interoperability and reduce costs for consumers and developers. As a result, Apple allegedly extracts more money from consumers, developers, content creators, artists, publishers, small businesses, and merchants.

The lawsuit aims to restore competition within these crucial markets on behalf of the American public. "Competition is essential for innovation and consumer choice," Nessel stated. "By limiting customer’s options, Apple's actions have hampered technological advancements while raising prices for consumers."

According to the complaint, Apple exercises monopoly power in both the smartphone and performance smartphone markets by engaging in illegal conduct designed to maintain its dominance while maximizing revenue extraction. This anti-competitive behavior reportedly manifests in various ways:

- Blocking innovative super apps: Disrupting apps with broad functionality that facilitate switching between competing platforms.

- Suppressing mobile cloud streaming services: Hindering cloud-streaming app development that offers high-quality gaming without costly hardware.

- Excluding cross-platform messaging apps: Deteriorating cross-platform messaging quality to ensure continued iPhone purchases.

- Diminishing non-Apple smartwatch functionality: Limiting third-party smartwatch capabilities to increase out-of-pocket costs for non-iPhone users.

- Limiting third-party digital wallets: Preventing third-party tap-to-pay functionality development.

Beyond these examples, Apple's conduct is alleged to impact web browsers, video communication services, news subscriptions, entertainment platforms, automotive services, advertising solutions, location services among others. The company is accused of having incentives to expand its influence over emerging devices and technologies.

Apple Inc., based in Cupertino California and incorporated in California as a publicly traded company generated $383 billion in annual gross revenues during fiscal year 2023 along with $97 billion net income surpassing any other Fortune 500 companies’ net incomes or GDPs from over 100 countries worldwide.

Attorney General Nessel joins her colleagues from Arizona California Connecticut District Columbia Maine Minnesota New Hampshire New Jersey New York North Dakota Oklahoma Oregon Tennessee Vermont Wisconsin alongside DOJ pursuing this legal action against Apple Inc.