US Judge Temporarily Blocks Microsoft’s Activision Deal at FTC Request

A US federal judge in San Francisco has granted the Federal Trade Commission’s (FTC) request to temporarily block Microsoft’s planned $69 billion acquisition of Activision Blizzard. The ruling, issued by Judge Edward Davila. Allows the FTC Request to pursue an effective permanent remedy in response to antitrust concerns.

Microsoft and Activision have until June 16 to submit their opposition to the motion. While the FTC must respond by June 20. An evidentiary hearing will be held on June 22 to further deliberate on the injunction.

FTC Request Antitrust Concerns

The FTC initiated an antitrust case against the Microsoft-Activision acquisition six months ago. Expressing concerns about the potential negative impact on competition if the deal were to proceed.

The FTC Request that Microsoft’s increased control over Activision could lead to content withholding or degradation, adversely affecting competition in terms of product quality, price, and innovation.

The FTC’s complaint emphasized the potential harm to consumers across multiple markets.

Microsoft appeared undeterred by the temporary injunction and expressed confidence in its case.

Microsoft President Brad Smith tweeted that the temporary order would expedite the decision-making process and benefit all parties involved.

Smith stated the company’s preference for constructive and amicable engagement with governments and reassured that Microsoft looks forward to presenting its case.

A Microsoft spokesperson reiterated the sentiment, emphasizing the need for a temporary restraining order until a final decision is reached by the court.

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Antitrust Investigations and Roadblocks

Since the announcement of the acquisition in January 2022, Microsoft has encountered various obstacles, including antitrust investigations from regulatory authorities such as the UK’s Competition and Markets Authority (CMA), the FTC Request, and the European Commission (EU).

In May 2023, the EU Commission cleared the deal, conditional upon Microsoft’s commitments to address identified competition concerns.

However, the UK’s CMA blocked the acquisition in the previous month, citing potential negative implications for the cloud gaming market.

Microsoft and Activision have appealed the decision, and the case is currently being heard by the UK’s Competition Appeal Tribunal.

The temporary injunction granted by the US judge adds another layer of complexity to Microsoft’s proposed acquisition of Activision Blizzard.

While the EU Commission has cleared the deal, the FTC Request concerns have led to a halt in the process.

The upcoming evidentiary hearing will provide an opportunity for all parties involved to present their arguments.

The outcome of the case will have significant implications for the future of the acquisition and the competitive landscape of the gaming industry.