Judge Nixes Injunction in Microsoft’s Activision Blizzard Acquisition

A federal district court judge in California denied the Federal Trade Commission’s (FTC) request for a preliminary injunction regarding Microsoft’s acquisition of Activision Blizzard, which could pave the way for the nearly $69 billion deal to close as soon as this month.

The court ruled the FTC was unlikely to prove that the merger would “substantially lessen competition.”

In the ruling, District Court Judge Jacqueline Scott Corley cited in part Microsoft’s commitment to keep Call of Duty on PlayStation for 10 years, on parity with Xbox, and that Microsoft inked an agreement with Nintendo to bring the game to Nintendo Switch.

The ruling could allow Microsoft to close the deal, pending Microsoft’s resolution of the UK’s Competition and Markets Authority (CMA) decision to block the deal on grounds it is anti-competitive.

Microsoft has signaled it intends to close the takeover, which would be the biggest ever in the gaming sector, by the July 18 deal termination date.

In filing its lawsuit in December 2022 seeking to block the deal, the FTC had said, “With control over Activision’s blockbuster franchises, Microsoft would have both the means and motive to harm competition by manipulating Activision’s pricing, degrading Activision’s game quality or player experience on rival consoles and gaming services, changing the terms and timing of access to Activision’s content, or withholding content from competitors entirely, resulting in harm to consumers.”

While the FTC can appeal this decision and still has its own anti-trust lawsuit in the works, this is a major win in favor of the acquisition.