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June 14, 2024

The DOJ is hitting Apple with a bigger bat than regulators are swinging at other tech giants

The DOJ is hitting Apple with a bigger bat than regulators are swinging at other tech giants

The sweeping antitrust lawsuit Apple faces from the Department of Justice takes a broader aim at its business than cases against Big Tech rivals including Google, Facebook, and Amazon. It’s also more grounded in antitrust law than some of those suits, experts say.

The DOJ alleged in its complaint filed last week that Apple has created an illegal monopoly in the smartphone market. The DOJ’s two cases against Google parent Alphabet, and the Federal Trade Commission’s lawsuits against Amazon and Facebook parent Meta, focus on their dominance of different markets: digital advertising, online retail, and personal social networking.

The flurry of litigation from the DOJ and FTC is an attempt to enforce regulation of Big Tech where lawmakers have largely failed. Their success would give other smartphone makers a better shot at competing with Apple, other search engines a stronger chance against Google, and other online retailers a fighting chance against Amazon.

The arguments at issue in the five recent Big Tech antitrust lawsuits are distinct. And it’s “good for the [tech] industry” that regulators are casting a wide net, said Barak Richman, a law professor at Duke University.

Read more: Apple says the DOJ’s antitrust lawsuit is misleading

Thomas Nachbar, a professor at the University of Virginia’s law school, echoed that sentiment. “As a matter of policy and politics, winning against one Big Tech firm will make it easier for enforcers to bring cases against others,” he said.

But there are also drawbacks to the varied antitrust approaches.

“The fact that the cases present slightly different theories and very different facts means that I’m not sure how strong a precedent they would set for each other,” Nachbar said.

Here’s a look at the case against Apple, and how it compares to suits against its tech rivals.

Apple vs. the DOJ

In a damning, 88-page complaint, the Department of Justice took broad aim at Apple.

The DOJ said the company’s anti-competitive practices not only hurt smartphone competitors but also developers of apps, smartwatches, and digital wallets. Apple’s alleged actions — inhibiting non-Apple smartwatches from maintaining a reliable connection to iPhones, for example — actually make the iPhone a worse product, the lawsuit said, all in the name of maintaining a monopoly.

“It makes no economic sense for Apple to sacrifice the profits it would earn from new features and functionality unless it has some other compensating reason to do so, such as protecting its monopoly profits,” the DOJ said in its complaint.

The claims levied against Apple, which the company vehemently denies, are more intuitive and far-reaching than those against the other four tech giants, Nachbar said.

Facebook vs. the FTC

The Federal Trade Commission’s lawsuit against Facebook parent Meta also alleged that it violated antitrust law and stifled competition — but through mergers. The FTC said Facebook’s acquisitions of Instagram and WhatsApp were meant to “eliminate threats to its monopoly,” violating the Sherman Antitrust Act.

But Nachbar believes the allegations against the social media company “are less well-connected to antitrust law.”

Richman, of Duke, went even further, calling the Facebook suit “antithetical” to federal antitrust law. “It seems to malign Facebook for buying something that could do something that it itself could not do,” he said. “And I think that that’s exactly the kind of acquisition you want companies to engage in.”

The FTC’s case against Amazon — which said the e-retail giant made life hard for lower-priced sellers on its site — is stronger than its suit against Facebook, according to Richman. Still, it’s Apple in hotter water because the DOJ suit attacks it on so many fronts.

Google vs. the DOJ

Perhaps the strongest of regulators’ Big Tech antitrust cases is the DOJ’s 2020 lawsuit against Google for maintaining a monopoly over search engine services. That ongoing case is more like the landmark 1998 antitrust action against Microsoft than the DOJ’s lawsuit against Apple, Richman said.

“The Google case has the benefit of drawing strong analogies to a previous case that the government won,” he said, “so to the degree that you can convince a court that [the lawsuit is] doing something that its predecessor did, that’s a good legal strategy.”

While the DOJ itself drew connections between its claims against Apple and the 1990s Microsoft case — Microsoft is mentioned 26 times in the complaint — those comparisons are less clear.

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