The U.S. Federal Trade Commission is examining whether Apple Inc. and Google Inc. are breaking antitrust law by sharing board members, according to a person familiar with the investigation.
Google Chief Executive Eric Schmidt and Arthur Levinson, chairman of Genentech Inc., serve as directors at Apple and Google. The FTC is looking at whether the interlocking boards could hurt competition in markets such as mobile-phone software and services, said the person, who declined to be identified because the matter is private.
The remedy could be as simple as directors leaving one of the boards to eliminate the overlap. At issue is whether their participation violates the "interlocking directorates" provision of the Clayton Antitrust Act of 1914, said Gary Reback, an attorney at Carr & Ferrell in Palo Alto.
"The theory of the law when the Clayton Act was first passed is that the powerful people would sit on each other's boards and not compete with each other," Reback said. "The overlaps between Google and Apple are obvious."
Apple offers the iPhone, which runs Google Maps and gives users the ability to play videos from Google's YouTube. Google, owner of the world's most-used search engine, helped develop Android, software that runs mobile phones. The two companies are also starting to compete in operating systems, as computer makers offer Android as an alternative to Microsoft Corp.'s Windows.
Schmidt has said he recuses himself from meetings when Apple's board talks about the iPhone.
The FTC and the companies declined to comment.