The Justice Department on Wednesday asked a federal judge to force Google-parent Alphabet to sell its Chrome browser and end payments to Apple, in the companies’ internet search deal, as part of antitrust legal remedies. Google stock tumbled on the news while Apple (AAPL) stock edged down.
The DOJ request follows a ruling by federal judge Amit Mehta in August that Alphabet (GOOGL) illegally maintained a monopoly over online search services and prevented rivals from developing their own products. A key part of the ruling centered on multibillion-dollar payments that Google makes to Apple to be the default search engine on iPhones.
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Whether the incoming Trump administration could modify the Justice Department’s antitrust remedy requests as part of a consent decree is unclear. President-elect Donald Trump has nominated former Rep. Matt Gaetz as the new attorney general.
In 2001, Microsoft (MSFT) reached an antitrust settlement with the U.S. government over similar issues.
Judge Mehta will oversee a trial starting in April to decide how to address Google’s antitrust violations. The judge has said he plans to decide by August. Alphabet is expected to appeal any decision.
Google Stock: Tunney Act A Wild Card?
“Under any circumstances we are still multiple appeals and many years away from anything being finalized,” said Craig Moffett, analyst at Moffett Nathanson, in a report. “The Tunney Act, which guarantees judicial oversight for antitrust settlements, precludes any ‘saved by the election bell’ moment. And recall that this case started in the first Trump administration. (Judge) Mehta will, in one way or another, weigh in.”
The Tunney Act refers to a 1974 law that subjects DOJ antitrust decisions to court review to ensure deals are in the public interest.
Moffett added: “We believe it would be a mistake to simply dismiss all of this as mere saber rattling. Apple’s valuation demands that investors consider even events many years in the future.”
On the stock market today, Alphabet stock fell 4.6% to near 168. Apple stock retreated 0.6% to 227.74.
Chrome controls about two-thirds of the global browser market.
The Justice Department also requested that Google be prevented from giving preferential access to its search engine on devices that use its Android mobile operating system.
Google Stock Technical Ratings
Further, Alphabet had climbed 26% in 2024 as of Wednesday’s market close. Apple stock had gained 18%.
GOOGL stock has a 182.02 entry point and a Composite Rating of 90 out of a best-possible 99, according to IBD Stock Checkup.
Follow Reinhardt Krause on Twitter @reinhardtk_tech for updates on artificial intelligence, cybersecurity and cloud computing.
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