Apple lawyers reportedly met with the Department of Justice last week, to make a last-minute plea for the agency not to file a US antitrust suit against the company.

Neither Apple nor the DOJ commented on the meeting, which follows the iPhone maker being accused of “malicious compliance” in its response to both the Supreme Court decision on the App Store, and European antitrust legislation taking effect next month …

Potential US antitrust suit

A lawsuit in the US, and new legislation in Europe, left Apple facing a similar need to permit the sale of iOS apps outside of its own App Store. Here’s your quick cheat-sheet to the US story so far:

• Epic Games introduced its own in-app payment system on iPhone
• This bypassed the App Store, and denied Apple its 30% commission
• This was a blatant breach of App Store terms & conditions
• Apple responded by throwing the company off the App Store
• The two companies went to court
• The court told Epic that, no, Apple did not operate a monopoly
• The court told Apple that, yes, it must allow app sales outside the App Store
• Both sides appealed the parts of the ruling they didn’t like
• The US Supreme Court declined to hear either appeal

That decision meant the original court rulings stand, and Apple responded with an announcement that, sure, it would allow third-party app sales – but it would still charge a 27% commission on them (and 12% instead of 15% for small developers).

That response has been described as “malicious compliance” as Apple would essentially get exactly the same net cut of app sales after c.3% transaction charges, whether or not they were made through the App Store.

That seems likely to provoke new US antitrust legislation, and strengthen the DOJ’s case for initiating legal proceedings against Apple.

Apple asked DOJ not to instigate legal proceedings

Bloomberg reports that Apple ‘representatives’ (read: lawyers) last week met with senior DOJ officials to ask them not to act.

Apple Inc. representatives met with the Justice Department last week in a final bid to persuade the agency not to file an antitrust suit against the company, according to people familiar with the matter. 

The company and its lawyers met with Assistant Attorney General Jonathan Kanter, who will make the final call on whether to file a suit, said the people, who asked not to be identified discussing the confidential meeting.

Such pleas are known to lawyers as “hail Mary” or “last rites” meetings, with a successful outcome unlikely.

Decision expected within weeks

The DOJ is expected to announce its decision soon, with Bloomberg sources indicating that this will be by the end of March.

Should the DOJ decide to proceed, it’s likely that one or more US state attorneys general will add their weight to the case, with California indicating its interest in doing so.

California Attorney General Rob Bonta said the state was in touch with the Justice Department about the potential case and could join onto an eventual complaint. 

“We’re very interested in” possibly joining, Bonta said. “We are very aware of the federal government’s interest in Apple. We are interested also, and it’s very aligned with our overall strategy in the tech industry.”

The EU is also likely to announce its own verdict on Apple’s very similar plan to comply with the Digital Markets Act. Regulators say they are ready to “take strong action” if they decide Apple’s approach is not acceptable, and it seems near-certain that the matter will end up in court.

Photo by Headway on Unsplash