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Apple today filed a pre-motion letter seeking to dismiss the antitrust case that the United States Department of Justice (DoJ) levied against Apple back in March.

Apple-vs-DOJ-Feature.jpg

In the pre-motion letter, Apple says that the government's lawsuit is flawed in multiple ways, and has not successfully alleged that Apple is a monopoly power in the relevant market, proven anticompetitive conduct, or demonstrated consumer harm. From Apple's filing:
This case lies well beyond the outer limits of antitrust law. A Section 2 Sherman Act claim can move past the pleadings only if the complaint alleges (1) monopoly power in a relevant market; (2) anticompetitive conduct; and (3) anticompetitive effects. [...]

This complaint fails on all three fronts. The Supreme Court has repeatedly held that the type of conduct at the core of this case--namely, Apple's decisions about how and whether to grant third parties access to its platform--does not give rise to Section 2 liability as a matter of law.

The complaint also nowhere connects the restrictions it challenges to any anticompetitive effects in the smartphone market. And regardless, far from being a monopolist, Apple faces fierce competition from well-established rivals, and the complaint fails to allege that Apple has the ability to charge supra-competitive prices or restrict output in the alleged smartphone markets, let alone that it has the market share necessary to establish or infer market power.
The DoJ's lawsuit attempts to establish a narrow market category by arguing that Apple dominates in the U.S. smartphone market and the U.S. "performance smartphone" market, but it's going to be tough to win even with that definition. Apple has 65 percent market share in the U.S. smartphone market and 70 percent in the "performance" category, but a designation of monopoly power typically requires a company to have a higher share of the market. Apple has argued that it should be judged based on its global market share, which is at 20 percent.

Apple points out that Supreme Court precedent favors allowing businesses to set the terms and prices of agreements that are entered into with third parties, and these agreements are what the DoJ has targeted in its complaint. The DoJ argues that Apple has restricted messaging apps, digital wallet development, and smart watch integration with the iPhone, among other things, and Apple says that historically, courts have rejected antitrust claims involving third party platform access.

Further, Apple suggests that the DoJ has not demonstrated that Apple's conduct has had "anticompetitive effects" on the smartphone market. While the lawsuit claims that Apple design decisions lock consumers into the Apple ecosystem, Apple says that it does not have allegations establishing "a factual link between those decisions and consumers' smartphone purchasing behavior."

Judge Neals, who is overseeing the case, required Apple to file its pre-motion letter to dismiss by today, and the DoJ's response is due on May 30. From there, the two parties will have a conference with Neals. After that, the full motion to dismiss will be filed, but this is not expected until mid-June at the earliest.

The government will need to respond 35 days after Apple files a motion to dismiss, and Apple will need to submit a reply brief 21 days after that. At that point, there may be a hearing, which is not expected to take place until September or later, and a ruling on the motion to dismiss will come late in 2024 or early 2025.

The lawsuit on the whole is going to be a multi-year process with Apple's answer to the initial complaint, discovery, trial, and additional appeals coming if the judge does not grant Apple's motion to dismiss the case at this point. It is unclear how the antitrust case will play out, because the DoJ's aim is to secure a ruling that does not fit with antitrust precedent in order to push antitrust law into new areas.

We have a complete Apple vs. the U.S. Department of Justice guide that breaks down the case, the DoJ's argument, and what consumers can expect as the lawsuit progresses.

Article Link: Apple Asks Judge to Dismiss U.S. Antitrust Lawsuit
 

GMShadow

macrumors 68000
Jun 8, 2021
1,909
7,736
monopoly? lol

apple has huge competition and Google is already way ahead in AI compared to Apple.

The DoJ's complaint could have been written by the EU (and probably was), it's the same nonsense.

The judge should dismiss the case, and then all parties in the DOJ involved should immediately be fired and subject to a full investigation for FARA violations.
 

d686546s

macrumors 6502a
Jan 11, 2021
687
1,666
In many ways it would probably be better for the case not to proceed and for the legislature to do its job, but somehow it feels like actual governance has gone out of fashion.
 
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Pezimak

macrumors 68040
May 1, 2021
3,165
3,525
2 stories of Apples Monopolistic behaviour in one day, flavour of the month it seems. It is funny how they ask for the case to just be dismissed though. No doubt part of the process I assume.
 

makeitrainnaren

macrumors regular
Dec 9, 2020
115
136
Massive respect for Lina Khan and her team at the FTC. In the last few years the FTC has:

1. Assisted in restoring net neutrality.
2. Itemized labels on ISP bills.
3. Capped credit card late fees.
4. Trying to stop the Activision / XBOX merger
5. Reeling in apple and their wildly anti consumer repair and software policies.
 

rp2011

macrumors 68020
Oct 12, 2010
2,421
2,798
It is a preposterous lawsuit. Apple has to keep hustling year after year to stay competitive, It is always one product away from becoming irrelevant. None of us would flinch moving away from Apple if it failed to align with our personal requirements for a device if there was something more compelling, as have so many people who choose Android with a much larger installed base worldwide and is owned by a company with a true monopoly in search.

Apple came to the smartphone market as the underdog making a huge bet to a marketplace with many options to choose from. Some consumers chose the underdog. Apple is still not the only choice and not the one with the most market share.

Just insane. I personally think this lawsuit is politically motivated and not for antitrust issues, but because of how profitable its recent run has been.
 
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Iconoclysm

macrumors 68040
May 13, 2010
3,232
2,702
Washington, DC
Massive respect for Lina Khan and her team at the FTC. In the last few years the FTC has:

1. Assisted in restoring net neutrality.
2. Itemized labels on ISP bills.
3. Capped credit card late fees.
4. Trying to stop the Activision / XBOX merger
5. Reeling in apple and their wildly anti consumer repair and software policies.
The first three also involve other agencies that are the real heroes. Number 4 wasn't stopped, was barely attempted, and was more of a "hey, the EU has problems so maybe we should too"...and it's arguable that stopping it would probably be worse than letting it go forward considering the behavior of the former company towards consumers.

As far as this case, they really lost their footing here by trying to fluff it up to the point that nothing is going to stick in the real world. There was probably something they could have won in there...but not like this.
 
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TigerNike23

macrumors 6502a
Feb 13, 2017
886
2,096
Fort Myers, FL
The first three also involve other agencies that are the real heroes. Number 4 wasn't stopped, was barely attempted, and was more of a "hey, the EU has problems so maybe we should too"...and it's arguable that stopping it would probably be worse than letting it go forward considering the behavior of the former company towards consumers.

As far as this case, they really lost their footing here by trying to fluff it up to the point that nothing is going to stick in the real world. There was probably something they could have won in there...but not like this.
Number 3 has been blocked by the federal courts.
 
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