Denied: FTC Loses Bid for Preliminary Injunction Against Microsoft’s Acquisition of Activision Blizzard

Key insights

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Key Ruling

A federal judge denied the FTC's request for a preliminary injunction against the Microsoft-Activision Blizzard acquisition.

The court's decision removes a significant U.S. legal barrier for Microsoft's proposed $69 billion acquisition of Activision Blizzard.

Court's Rationale

The court found the FTC did not prove the merger would substantially lessen competition.

Evidence suggested the deal would likely increase consumer access to popular titles such as Call of Duty and World of Warcraft.

Key Determination. The court ruled that the FTC failed to demonstrate that the merger would likely lead to a substantial lessening of competition, noting that evidence suggested the deal would increase consumer…

Global Approvals

Most other global jurisdictions have already approved the acquisition.

The global regulatory landscape remains mixed, with some jurisdictions having approved the deal and others still evaluating its potential market impact.

Widespread Approval. Most other global jurisdictions have already approved the acquisition, though Canada has previously indicated potential concerns regarding the deal.

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Summary

A federal judge has denied the Federal Trade Commission’s request for a preliminary injunction to block Microsoft’s proposed $69 billion acquisition of Activision Blizzard. The court concluded that the agency failed to demonstrate a likelihood of success in proving that the vertical merger would substantially lessen competition. Instead, the presiding judge determined that evidence suggested the deal would likely increase consumer access to popular titles such as Call of Duty and World of Warcraft.

This ruling removes a significant legal barrier for Microsoft as it attempts to finalize the acquisition before its July 18, 2023, deadline. While the decision represents a major victory for the companies involved, the merger remains subject to regulatory scrutiny in several international jurisdictions. Specifically, Microsoft must still address concerns raised by the United Kingdom’s Competition and Markets Authority (CMA), as well as ongoing regulatory reviews in Canada, Australia, and New Zealand.

In response to the ruling, Microsoft and Activision Blizzard have agreed with the CMA to stay litigation in the United Kingdom to facilitate potential restructuring proposals that might satisfy the regulator's requirements. Although the FTC retains the option to appeal the decision through the Ninth Circuit Court of Appeals, the immediate impact of the ruling is a clear advancement for the transaction. The global regulatory landscape remains mixed, with many other jurisdictions having already approved the deal, while others continue to evaluate its potential market impact.