By Blake Brittain

Jan 27 (Reuters) - The maker of a smartphone video app sued Apple AAPL.O in New Jersey federal court on Tuesday, alleging the iPhone maker stole its technology and holds an illegal monopoly over the U.S. smartphone software market.

Reincubate Ltd said Apple copied patented features of its app Camo, which works with multiple operating systems, and incorporated them into iOS in order to "redirect user demand to Apple’s own platform-tied offering."

The lawsuit said Apple's conduct violates U.S. antitrust law by locking users into its dominant mobile operating system and preventing them from switching to competitors. The U.S. government brought similar antitrust allegations against Apple in a 2024 lawsuit that is still ongoing.

Spokespeople for Apple did not immediately respond to a request for comment.

"Rather than competing with us, Apple deployed a series of obstacles to tilt the playing field, infringed our IP, and did so in service of preventing competition from rival platforms," Reincubate CEO Aidan Fitzpatrick said in a statement.

Camo, released by London-based Reincubate in 2020, enables the use of smartphones as webcams for computer-based video calls. According to the lawsuit, Apple "actively induced and encouraged" Reincubate to develop and market Camo for iOS before the tech giant copied it and integrated its features into iOS as "Continuity Camera" in 2022.

Reincubate called Apple's conduct an example of "Sherlocking," which it said was "shorthand for Apple’s pattern of appropriating and extinguishing innovative software developed outside its ecosystem."

"In most of those cases, Apple has not actively induced the developer to test and build software," the lawsuit said. "Here, Apple actively cultivated a relationship of trust with Reincubate, induced the company to share technical details, beta builds, and market data, and leveraged that privileged access to inform its own development of Continuity Camera."

In addition to its antitrust claims, the lawsuit accused Apple of infringing Reincubate patents. The company requested an unspecified amount of monetary damages and court orders blocking Apple's alleged misconduct.

The case is Reincubate Ltd v. Apple Inc, U.S. District Court for the District of New Jersey, No. 2:26-cv-00828.

For Reincubate: David Hecht, Maxim Price and Peter Park of Hecht Partners

For Apple: attorney information not yet available

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Apple loses bid to dismiss US smartphone monopoly case

(Reporting by Blake Brittain in Washington)