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US FTC tries again to stop Microsoft’s already-closed deal for Activision

Big Tech
Photo: Microsoft

The US FTC tries again to stop Microsoft’s already-closed deal with Activision. In their most recent effort to prevent the transaction from going through, antitrust regulators in the United States will argue on Wednesday that a federal judge made a mistake when she determined that Microsoft’s (MSFT.O) $69 billion proposal to acquire Activision Blizzard (ATVI.MX), which is the company that makes “Call of Duty,” was permissible under competition law.

On October 13 of this year, Microsoft completed the transaction, which had been suggested in January 2022 as the most significant purchase in the history of the gaming business. This was accomplished after the company received clearance from the British authorities.

The Federal Trade Commission, on the other hand, is anticipated to inform a panel of three judges in the appeals court in California that the lower-court judge held the agency to an excessively high standard, effectively requiring it to prove that the deal was anti-competitive when the standard is simply that the deal raises serious concerns about competition.

Considering that the FTC was unsuccessful in its case in the lower court and that both the European Union and Britain have granted their approval to the agreement, the FTC is facing an uphill struggle.

The court battle is a component of a more significant effort by the administration of Vice President Joe Biden to combat mergers and price increases that impact consumers in various industries, including pharmaceuticals and airline tickets.

It is also anticipated that the Federal Trade Commission would argue that the judge made a mistake when he relied on agreements that Microsoft had made with competitors to distribute games as evidence that the merger would not hurt competition.

In December 2022, the Federal Trade Commission (FTC) sued to halt the transaction. The lawsuit said that Microsoft would utilize Activision’s successful games to stifle competition on its Xbox consoles and monopolize the rapidly expanding subscription and cloud gaming sectors for its benefit. Nevertheless, in July, a federal court in California found that the defendant failed to make its case.

Microsoft anticipates that the Federal Trade Commission will claim that the judge failed to demonstrate that she made a mistake in her decision. In addition, it will argue that the agency did not demonstrate that Microsoft had a reason to prevent “Call of Duty” from being released on competing gaming systems.

Former President Donald Trump nominated Daniel Collins and Danielle Forrest, and Jennifer Sung, whom President Joe Biden nominated, are expected to serve as the judges on the panel.

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