The Justice Department is ready to sue Apple Inc. on Thursday accused the world’s second-most valuable technology company of violating antitrust laws by denying rivals access to hardware and software features of its iPhone.
The lawsuit, expected to be filed in federal court, according to people familiar with the matter, escalates the Biden administration’s antitrust battles against most of the largest U.S. tech giants. The Justice Department is already suing Alphabet Inc Google for monopolization, while the Federal Trade Commission is pursuing antitrust cases against it Metaplatforms Inc. and Amazon.com Inc.
Apple and the Justice Department did not immediately respond to requests for comment. The acquaintances asked not to be named because the matter was confidential.
Apple shares fell as much as 1.4% to $176.10 in late trading on the news. They had fallen 7.2% this year through Wednesday’s close.
The upcoming case is the third time in the last 14 years that the Justice Department has sued Apple for antitrust violations, but it is the first case in which the iPhone maker is accused of illegally maintaining its market dominance.
The lawsuit comes at a time when Apple is increasingly under scrutiny in Europe for alleged anti-competitive behavior. The company was fined €1.8 billion this month for withdrawing from the business Music streaming competitors from offering cheaper offers. Apple is appealing the penalty, saying regulators found no “credible evidence of harm to consumers.”
In the meantime, the company may face total collapse Investigation under the EU’s new rules for Big Tech – the Digital Markets Act – which came into force earlier this month. Rivals have criticized new App Store rules that have come into effect in Europe, complaining that changes would likely result in higher prices for developers. Penalties for non-compliance with the new EU rules can be severe – up to 10% of a company’s annual global turnover, or up to 20% for repeat offenders.
The Justice Department opened the latest case in 2019 under former President Donald Trump. However, the Antitrust Division chose to prioritize dual cases against Google, thereby taking a back seat Fourteen days The manufacturer Epic Games Inc. sued Apple in 2020 for monopolization and that case went through the federal courts.