FTC seeks injunction to block $68.7B Microsoft acquisition of Activision Blizzard
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The Federal Trade Commission (FTC) has reportedly filed a request for an injunction to temporarily block Microsoft’s $68.7 billion acquisition of Activision Blizzard.
The proposed merger agreement has a deadline to complete the deal by July 18. This injunction would prevent the deal from closing by this deadline. This will allow the FTC’s administrative law judge (ALJ) to rule on the motion to block the merger. The ALJ’s next hearing is scheduled for August 2, 2023.
If the ALJ rules against the acquisition, Microsoft and Activision Blizzard can appeal to the FTC’s full commission. If the commission rules against Microsoft, the next appeal would go to federal court.
In its original complaint, the FTC alleged that the deal would “enable Microsoft to suppress competitors to its Xbox gaming consoles and its rapidly growing subscription content and cloud-gaming business.”
The current state of the FTC could pose a challenge for Microsoft and Activision Blizzard. Notably, the FTC’s typically five person panel is down two members. Former commissioners Noah Joshua Phillips resigned in October 2022 and Christine S. Wilson resigned in March 2023. In December, the (then) four person panel ruled 3-1 against Activision Blizzard and Microsoft, allowing the deal to proceed to the ALJ. Wilson was the sole vote in favor of the deal proceeding.
The FTC has also ruled against Microsoft recently. In June 2022, Microsoft settled FTC charges that it violated the Children’s Online Privacy Protection Act (COPPA) by agreeing to pay $20 million. The FTC alleged that Microsoft was collecting data on children that signed up to Xbox
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