The US Federal Trade Commission urged an appeals court to delay Microsoft Corp.’s $69 billion takeover of Activision Blizzard Inc. while the agency’s challenge to the largest-ever gaming deal is pending.
The FTC wants the 9th Circuit Court of Appeals in San Francisco to overturn a lower-court judge’s finding that the blockbuster game deal won’t thwart competition in the markets for console, subscription and cloud gaming and harm consumers.
US District Judge Jacqueline Scott Corley on Tuesday denied the agency’s request for a preliminary injunction that would have stopped the deal from closing before a July 18 deadline.
Despite the huge blow, the FTC isn’t backing down in the antitrust fight that represents a major test of its ability to block big tech deals in court after the agency lost a challenge to an acquisition by Meta Platforms Inc. earlier this year.
Corley said the FTC would need an emergency stay from the 9th Circuit to extend a temporary hold on the deal that is set to expire at midnight Friday US West Coast time.
Read more: Microsoft Cleared to Buy Activision in US as UK Pauses Fight (1)
The appeal creates another legal hurdle for Microsoft is it pushes to close a deal that would help expand its presence in mobile gaming and vault itself to the No. 3 position in the global gaming market after Tencent Holdings Ltd. and Sony Corp.
The FTC is angling to move ahead with an administrative antitrust challenge to the deal that was scheduled to begin early next month. Microsoft also remains stuck in a battle with the UK’s Competition and Markets Authority that vetoed the deal in May.
After Corley’s decision came down, the CMA said it’s willing to reassess proposals from Microsoft and agreed to pause the companies’ appeal before the Competition Appeal Tribunal. That hold gives the firms a chance to suggest potential fixes aimed at easing UK concerns that the takeover would stymie competition. But a restructuring of the deal could also trigger a new investigation by Britain’s antitrust watchdog.
