In a supplemental brief filed on Thursday, Apple doubled down on arguments that the antitrust complaint filed against it alleging horizontal conspiracy and monopolization must be rejected. The submission suggests that since Judge Haywood S. Gilliam Jr. sent the claims against Google to arbitration, “certain infirmities” in plaintiff’s amended complaint merit further emphasis as they pertain to Apple.
In May, a company who paid Google for online search advertisements filed suit against both companies and some of their executives. According to the California Crane School’s first amended complaint, Google and Apple conspired to restrict the market for online searches by Apple agreeing to refrain from competing with Google Search, and in turn, receiving payments from Google.
The suit states claims under Sections 1 and 2 of the Sherman Act for horizontal conspiracy and monopoly, and seeks relief, including disaggregation of the companies.
Two weeks ago, Judge Gilliam ruled that the plaintiff had to arbitrate its claims against Google owing to the existence of a binding arbitration agreement. However, the court declined to stay the remaining claims against Apple, finding that the risk of different outcomes between the proceedings was not a good enough reason to pause the case.
Now, and in light of that ruling, Apple reiterates that the plaintiff’s Sherman Act claims fail to show that Apple and Google colluded. “Plaintiff conjures a horizontal agreement not to compete from scattered (and, in many cases, innocuous and public) comments made over the course of almost two decades, ‘secret meetings’ between executives that were held in plain view at public restaurants, and a nonexclusive vertical agreement between two companies with complementary, not competing, assets,” the motion says.
Further, the plaintiff purportedly ignores obvious alternative explanations for Apple’s conduct, like the fact that Apple might want to incorporate Google Search into its products to make them better in a market, the online search market, in which it does not participate. As for the meetings, another obvious alternative explanation is that the companies’ executives met in connection with the aforementioned procompetitive vertical arrangement, Apple says.
In addition, the filing faults the plaintiff for failing to demonstrate intent for their Sherman Act conspiracy-to-monopolize claim, as it is void of facts showing that Apple intended to imbue Google or itself with monopoly power.
The filing adds that the plaintiff’s asserted antitrust injury, that it overpaid for advertising owing to the parties’ illegal agreement, impermissibly relies on a series of assumptions. In order to make the leap that the plaintiff asks, the court has to theorize that Apple had been working on its own search engine, that it would enter the market for general search services, and that it would have developed a competing search advertising business that, in turn, would have driven down the price for search advertising placement, the motion says.
The filing concludes that amendment would be futile, and consequently, asks for dismissal with prejudice.
The plaintiff is represented by Alioto Law Firm and Law Offices of Lawrence G. Papale, among others. Apple and Tim Cook are represented by Skadden, Arps, Slate, Meagher & Flom LLP.
