DOJ Files Massive Antitrust Lawsuit Against Apple

( – The Sherman Antitrust Act of 1890, which was amended by the Clayton Act in 1914, recognized that when only a small handful of people/corporations had a monopoly on an industry, it could stifle free trade and cost Americans more for a given service or product.

Amongst the most well-known instances of the government using this law can be found when the Standard Oil Company of New Jersey owned by the Rockefeller family was forced to break apart in 1911, and in 1984, when “Ma Bell (AT&T)” was threatened with similar legal action because of their overwhelming control of the telephone industry was split into the so-called “Baby Bells.”

Now, the Department of Justice (DOJ) has announced that they have nocked another arrow into this particular bow and are planning to do their version of William Tell’s famous shot by targeting Apple.

Too Much Control

Fifteen states and the District of Columbia have joined in with the DOJ and have filed an 88-page antitrust lawsuit in the US District Court for New Jersey against Apple Inc, alleging a pattern of practices intentionally devised to first obtain, and then maintain their dominance in the smartphone industry.

The complaint maintains that the company that brought the world the iPhone has used unfair business practices and manipulation of vendors and consumers to make it difficult and/or expensive to switch from their brand to one of their Android competitors.

In the opening paragraph of the court filing, the government claims that at least as far back as 2010, Steve Jobs and his crew embarked on a path so that the all-important app store would be structured in a way that would “lock in both developers and users on its platform.” The press release put out by the DOJ announcing the lawsuit also accuses Apple of unfair conduct by preventing any digital wallet other than their own from using “tap-to-pay functionality” for purchases at retail stores.

Other allegations from the release from the government include intentionally degrading the features of their Apple watches and cross-platform messaging apps, the latter giving rise to a form of cyberbullying because of so-called “green bubbles.” The complaint filed in court says that when somebody joins a chat stream using something other than an iPhone, their contributions are surrounded by this color.

The DOJ contends that the contributions to a chat by non-iPhone participants aren’t encrypted and included videos are “pixilated and grainy [signaling] to users that rivals smartphones are lower quality” even though it is Apple’s manipulations that are causing the problem not the rival company’s device.

The government maintains that this practice causes “social stigma, exclusion, and blame for ‘breaking’ chats,” particularly among teenagers where surveys have the iPhone market share as high as 85%.

The court documents also make the serious allegations that these problems could be solved but Apple refused to do so because it would just make it easier for “iPhone families [to give] their kids Android phones.” Another claim the government makes centers on a person asking CEO Tim Cook for help because they could not send videos to their mother who uses an Android device, his response was flippant and dismissive, “buy your mom an iPhone.”

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