
Apple is facing impending legal action from the US Justice Department, which is expected to file a lawsuit as early as Thursday.
According to a report by Bloomberg, the lawsuit accuses the tech giant of violating antitrust laws by allegedly impeding rivals from accessing essential hardware and software features of its iconic iPhone.
This move marks a significant escalation in the Biden administration's ongoing antitrust crackdown on major US technology firms.
Notably, the Justice Department is already engaged in antitrust battles against other tech giants like Google, Meta Platforms Inc., and Amazon.com Inc.
According to sources familiar with the matter, the lawsuit against Apple is set to be filed in federal court.
While neither Apple nor the Justice Department has officially commented on the impending legal action, the development has already impacted Apple's stock performance.
Apple shares experienced a decline of up to 1.4 per cent, dropping to $176.10 in late trading upon news of the impending lawsuit.
This downturn adds to the company's challenges, as its shares had already fallen 7.2 per cent year-to-date as of Wednesday's close.
This anticipated lawsuit will mark the third time in the past 14 years that Apple has faced legal action from the Justice Department for alleged antitrust violations.
However, it notably represents the first instance where the company is accused of unlawfully maintaining its dominant position.
The legal scrutiny intensifies as Apple faces increased regulatory pressure in Europe over alleged anticompetitive practices.
Earlier this month, the company was fined €1.8 billion for allegedly stifling competition by preventing music streaming rivals from offering lower-priced deals.
In addition to the impending legal action in the US, Apple is also facing heightened regulatory scrutiny in Europe.
The European Union's new regulations for Big Tech, known as the Digital Markets Act, have come into force, potentially subjecting Apple to a full-blown investigation.
Rivals have criticised Apple's new App Store rules, expressing concerns that the changes could lead to higher prices for developers.
Non-compliance with the EU's regulations could result in significant penalties, amounting to as much as 10 per cent of the company's annual worldwide revenue.
The Justice Department initiated the latest investigation into Apple's practices in 2019 during the tenure of former President Donald Trump.
While the antitrust division initially focused on twin cases against Google, it later became embroiled in litigation as Epic Games Inc. sued Apple for alleged monopolisation in 2020.
(With inputs from Bloomberg)