David Shepardson
WASHINGTON (Reuters) – Apple said on Tuesday it plans to ask a U.S. judge to throw out a lawsuit filed by the Justice Department and 15 states in March that alleged the iPhone maker has monopolized the smartphone market, hurt smaller rivals and raised prices .
In a letter to US District Judge Julien Neals in New Jersey, Apple (NASDAQ:) said that “Apple is not a monopolist, it faces intense competition from well-established competitors, and the complaint does not allege that Apple has the ability to establish hypercompetitive prices or limit production to expected
smartphone markets.”
In a letter to the judge, Apple said the Justice Department was relying on a new “theory of antitrust liability that no court has recognized.”
The government is expected to respond within seven days to Apple’s letter, which the court is requiring the parties to submit, hoping to expedite the case before moving on to a potentially more drastic and costly effort to dismiss the lawsuit.
The Justice Department alleges that Apple is using its market power to extract more money from consumers, developers, content creators, artists, publishers, small businesses and merchants. The civil suit accuses Apple of having an illegal monopoly on smartphones, maintained by imposing contractual restrictions on developers and denying access to them.
The Justice Department, which did not immediately comment, has previously said Apple charges as much as $1,599 for iPhones and makes more profit than any competitor. Officials also said Apple charges hidden fees to various business partners – from software developers to credit card companies and even competitors like Alphabet’s (NASDAQ:) Google – in ways that ultimately drive up prices for consumers.
Apple has rejected government claims that the iPhone keeps consumers glued to the devices. “Someone who is unhappy with Apple’s restrictions has every incentive to switch to
competitor platforms that supposedly do not have such restrictions,” the letter says.
“Consumers should not have to pay higher prices because companies violate antitrust laws,” Attorney General Merrick Garland said in March. “If left unchecked, Apple will only continue to strengthen its monopoly on smartphones.”