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The U.S. Department of Justice (DOJ), along with 16 state and district attorneys general, has filed a civil antitrust lawsuit against tech giant Apple Inc. The lawsuit accuses Apple of monopolizing or attempting to monopolize the smartphone market, alleging violations of Section 2 of the Sherman Act. This legal action, initiated in the U.S. District Court for the District of New Jersey, asserts that Apple has unlawfully maintained its monopoly in the smartphone industry by implementing restrictive contractual measures and limiting developer access to essential resources.
According to the DOJ, Apple’s practices have stifled innovation and increased costs for developers, businesses, and consumers. The complaint highlights how Apple allegedly curtails competition and innovation by hindering the development of super apps, mobile cloud streaming services, cross-platform messaging apps, and third-party smartwatch and digital wallet functionalities. This behavior is purportedly part of a broader strategy to keep consumers tied to Apple’s ecosystem, thereby sustaining its monopoly and maximizing revenue extraction.
Attorney General Merrick B. Garland emphasized the importance of enforcing antitrust laws to prevent monopolistic practices that lead to higher consumer prices and limited choices. He noted that the lawsuit aims to challenge Apple’s dominance and restore competitive fairness in the market. Similarly, other DOJ officials underscored their commitment to promoting economic justice and curbing anticompetitive practices.
Apple’s response to the lawsuit was to defend its business practices, asserting that they foster innovation and protect user privacy and security. The company warned that the lawsuit could set a harmful precedent by allowing excessive governmental interference in technology design.
The lawsuit comes at a time when Apple is facing increased regulatory scrutiny globally. In Europe, the company is under investigation for potential violations of the Digital Markets Act, which could result in significant financial penalties. Apple has recently been fined by the European Union for anti-competitive practices related to music streaming services.
As the legal and regulatory challenges mount, Apple’s market valuation has experienced a significant downturn, with the company losing approximately $113 billion in market value following the announcement of the lawsuit. This development marks a continuation of the growing global scrutiny on major tech firms for their market practices.
The Sherman Act, under which Apple is being sued, is a landmark U.S. antitrust law enacted in 1890. It aims to prohibit monopolistic behaviors and promote competition. Section 2 of the Sherman Act specifically targets the abuse of monopoly power. This lawsuit against Apple is part of a broader trend of increased regulatory scrutiny of tech giants, reflecting growing concerns about their market power and influence on the economy, innovation, and consumer choice.