Apple Inc. executives engaged in a final attempt to dissuade the Justice Department from pursuing an antitrust lawsuit against the company, sources familiar with the matter disclosed. Representatives from Apple and its legal team convened with Assistant Attorney General Jonathan Kanter, who holds the authority to decide on the lawsuit’s filing. These discussions, often termed “last rites” meetings, typically precede the initiation of legal action.
Allegations and Implications
Antitrust investigators, examining Apple’s practices since 2019, assert that the tech giant has enforced software and hardware restrictions on its iPhones and iPads to hinder competitors’ effectiveness. The anticipated lawsuit is projected to materialize in the forthcoming weeks, potentially by the end of March, as per the sources.
Apple refrained from immediate commentary in response to requests for remarks, while the Justice Department opted not to provide any statements.
Scrutiny on App Store Policies
Apple’s App Store, known for its imposition of a commission ranging from 15% to 30% on developers, has faced considerable scrutiny from both developers and legislators. In January, Apple announced adjustments allowing US developers to employ alternative payment systems, albeit subject to a 27% fee on most digital purchases or 12% on subscriptions. These modifications were met with opposition, notably from Epic Games Inc., engaged in ongoing litigation with Apple over its App Store policies.
State and Federal Alignment
California Attorney General Rob Bonta conveyed the state’s interest in potentially aligning with the Justice Department’s actions against Apple. Bonta emphasized California’s synergy with federal scrutiny, particularly concerning the tech industry.
European Regulatory Landscape
As the Justice Department’s gaze remains fixed on Apple, the company’s maneuvers in Europe are also under observation. Apple is poised to comply with new digital gatekeeper regulations, including provisions allowing software downloads from sources beyond its App Store and facilitating alternative payment systems. However, developer groups have criticized these measures as “malicious compliance,” citing new fees and restrictions imposed by Apple.
Anticipated EU Fine and Settlement Offer
In addition to ongoing regulatory actions, Apple faces a prospective fine of at least €500 million ($542 million) from the EU’s antitrust watchdog over allegations of stifling music-streaming competitors on its platforms. Meanwhile, the company has proffered a settlement in a separate investigation, proposing access to its near-field communication chip for rival digital wallets.
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