The FTC Will Appeal The Court’s Decision To Permit Microsoft-Activision Deal

The proposed acquisition of Activision-Blizzard by Microsoft seemed to be moving forward until the Federal Trade Commission filed suit to block the deal from going forward. Earlier this week, the FTC lost in court but is now trying again and will appeal the Judge’s decision to throw out the FTC’s injunction. The FTC filed its appeal against district judge Jacqueline Scott Corley this evening. 

Notice is hereby given that Plaintiff Federal Trade Commission (“FTC”) appeals to the United States Court of Appeals for the Ninth Circuit from this Court’s Opinion dated July 10, 2023 and entered on the Court’s docket on July 11, 2023 at ECF Docket Number 305 denying the FTC’s request for a preliminary injunction pursuant to Federal Trade Commission Act § 13(b), 15 U.S.C. 53(b).

The FTC and the UK’s CMA have been the biggest roadblocks to the deal, as both regulatory bodies accused Microsoft of anti-competitive behavior in the cloud gaming market. The deal so far has been approved in virtually every major jurisdiction, including the EU, China, Saudi Arabia, Brazil, and others. 

The FTC had until Friday to file its appeal, but there is still a possibility for things to fall through. If the FTC is successful in its appeal, then Microsoft could be blocked from acquiring Activision Blizzard, the company even stated it would walk away from the deal if an injunction were to be filed. If all goes well for Microsoft, the deal could potentially close as early as this Saturday. 

Still, it seems like the FTC is fighting a losing battle. Its arguments were swiftly shut down by the courts, ruling that Microsoft would not gain a significant competitive advantage and that Microsoft would honor its commitments to keep the Call of Duty franchise available on PlayStation.

Microsoft is still engaged in a legal battle with the United Kingdom’s Competition and Markets Authority (CMA), which blocked the deal from moving. CNBC reported that the two entities agreed to a “small divesture” in the market which could allow the deal to move forward, although the CMA recently stated that a new investigation of the deal could be opened. 

The $69 billion acquisition of Activision-Blizzard would be the largest in all of gaming, however, the FTC is determined to shut the deal down, no matter the cost to the taxpayer or to their reputation. We will see how these legal battles play out over the next couple of weeks.