Another sad day-UPdate Microsoft's Acquisition of Activision Blizzard Has Been Temporarily Blocked

The Federal Trade Commission (FTC) will file an injunction today to block Microsoft's proposed acquisition of Activision Blizzard, CNN reports.

“We welcome the opportunity to present our case in federal court,” Brad Smith, Microsoft’s president, said in a statement to CNN. “We believe accelerating the legal process in the U.S. will ultimately bring more choice and competition to the market.”

In January 2022 Microsoft announced plans to buy Activision Blizzard for $69 billion. In December, the FTC sued Microsoft to block the deal from happening. The only other regulator to block the deal is the UK's Competition Markets Authority (CMA), citing concerns over the potential of the cloud gaming market. Both Activision and Microsoft have appealed that decision.

Microsoft has announced a raft of initiatives aimed at addressing regulator concern over the deal. Examples include Nvidia's 10-year agreement with Microsoft to bring Xbox Game Studios titles onto Nvidia's cloud gaming service, GeForce Now. Microsoft struck a similar deal with Nintendo earlier this year where the company announced plans to bring Call of Duty to Nintendo platforms "the same day as Xbox".

https://www.ign.com/articles/ftc-will-reportedly-file-injunction-against-microsofts-acquisition-of-activision-blizzard

well looks like Uncle Phil just cant seem to get a break :(

Update (6/13/23) -A federal court in California has issued a temporary restraining order requested by the FTC that effectively blocks Microsoft's $68.7 billion deal to acquire Activision Blizzard for the time being.

As reported by The Verge, the court in question agreed to issue the restraining order requested by the FTC as it considers the a preliminary injunction that would allow the FTC to make a legal case against Microsoft before the deal could be completed.

“Accelerating the legal process in the US will ultimately bring more choice and competition to the gaming market,” Microsoft spokesperson David Cuddy said in a statement to The Verge. “A temporary restraining order makes sense until we can receive a decision from the Court, which is moving swiftly.”

This order means Microsoft and Activision can not complete the deal until "after 11:59pm Pacific Time on the fifth business day after the Court rules on the FTC's request for a preliminary injunction" or, if it's later, a date set by the court.

As for the preliminary injunction, an evidentiary hearing on the matter will take place on June 22 and 23, and Microsoft and Activision will be able to "submit their brief in opposition to the motion for preliminary injunction by June 16, 2023." The FTC will then be able to submit its reply by noon on June 20.

It's important to note that the Microsoft and Activision deal would need to close before July 18, 2023, or the two parties will need to renegotiate. If they don't agree to new terms, Microsoft will need to pay Activision Blizzard a $3 billion breakup fee.

https://www.ign.com/articles/microsofts-acquisition-of-activision-blizzard-has-been-temporarily-blocked-by-a-restraining-order-from-the-ftc

Ouch a restraining order has been requested :(

This could speed up whatever the eventual outcome will be. If the federal judge denies the injunction do you think the FTC goes ahead with their internal efforts to block it? Likewise if the judge sees that there is enough to allow the injunction, perhaps MS steps away.

Seems like the MS show really elevated the levels of concern.

If the EU courts cleared it, the US court system will clear it. It'll just be a matter of time.

At this point, could go either way, really.

The Xbox showcase has the TC all triggered n shit 🤣

Starfield will never be on PlayStation and Sony's best selling game will be an Xbox studios one.

Chin up kid,you still got sales👍

@simple-facts: I don't think "lol people prefer to buy your console over mine" is the own you think it is.

LOL, Xbox amazing showcase got Sony fans grasping for straws.

Straws needs to be more accessible.😎

@Pedro: Don't tell California that.

@Wasdie:

You can't play sales.

Simple facts

I am very concerned!

The sooner this is over with the better which ever way it falls.

good. Let Microsoft take that $70billion and give us actual gameplay footage of Fable 🤣

To quote Donald Glover: "Good."

@daredevils2k: this is the normal course, since they initially rejected it.

MS is going to win the appeal, IMO.

I don't see why they'd do this out of the blue. MS is likely going to have their CMA appeals hearings overlap the FTC administrative court dates. I wouldn't doubt that if it weren't for the CMA that MS and ABK would ink the deal despite the pending FTC administrative court hearings, and possibly why FTC seeks the injunction.

Curious if given the back channeling between the FTC and CMA that's come to light recently, it makes me wonder whether this action is prompted by developments in the UK we are not currently aware of yet, something that could be in news soon, something that got communicated to Lina Khan ahead of it going public. That perhaps the CMA blockage might be stopped, made ineffective, or things legally aren't boding well on the appeal in UK for the CMA. If that's the case I can see why they'd be doing this proactively as a preemptive measure.

I had heard murmerings that a potential solution to work around the merger in UK with the CMA ruling would be simply to remove ABKs business operations from UK entirely, incorporate their regional offices in EU, and reintroduce the content to the market in UK from the new business location. And of course taking steps around what content to keep off Game Pass and/or cloud in the region, or whatever they'd have to do to keep the maneuver legal. Something like that, but I don't imagine they'd do that before their court proceedings.

But about those court proceedings next month in UK, the judge in the case seems to have a strong grasp of the case and understanding of markets and tech and IP law, and has been critical of the CMAs lengthy convoluted and laborishly abstract rationales made to block the deal. And given those proceedings shouldn't take long, could be the CMA's blockage could be dead by August potentially, right on heals of when the FTC administrative hearings should be beginning. If that happened, I'd no doubt MS would attempt to ink the deal before the FTC administrative hearings conclude.

Anyhow, curious of mainly one things developing from this news. That's what material info on the CMA appeal might be coming to light soon that prompted the FTC to take this action? I still feel something prompted this action, and cueious to know what that is. Maybe time will tell. But I don't think they did this simply to stall the process hoping it dies that way, MS and ABK seem committed to the merger regardless of their initial deadline.

This isn’t about blocking the deal, it’s to prevent Microsoft closing the deal before July 18 deadline. Even if this block goes through, it won’t stop Microsoft buying Activision after July 18. FTC knows that Microsoft is trying to buy Activision even without their approval.

It's about time.

@lavamelon: I'd be curious whether a judge would even humor the injunction if they get a whiff that the injunction is meant to squash the deal by extending it past its initial deadline, then again they might if they feel their court would be undermined by MS and ABK merging prior to their administrative hearings. It's a bit of a jump ball for now, we'll see how that goes.

Good, though it will pass eventually. This capitalist dystopia we are devolving into won't say no the megacorporations like MS for very long. Sure, they'll put up a strong front and do the whole "No, no, no...well OK yes." for a while, but it makes little difference.

Thank god for independent and small-scale studios. Keep gobbling up those market shares a percent or two at a time! Eventually combined you'll be able to make a dent!

Would love to know who's palms MS greased in both EU and US systems.

From the president of MS

If Brad Smith isn't worried, they're good2go.

Seems MS is happy this could accelerate the timeline of the administrative court proceedings. Seems FTC could have shot themselves in the foot on this one. Seems they wanted to drag this out in hopes the administrative court proceedings being in August might have killed the deal. It'll still go past that initial merger deadline but both parties in the merger seem committed despite that. Anyhow, it appears since they've mustered 30 depositions, following their numerous subpeona requests with Sony, among many other third parties, I'd be excited to see this process play out in these proceedings.

A more expedient scenario in Microsoft's favor would be to successfully get the proceedings tossed on grounds of flimsy legal reasoning on FTC's part, but even then as an Xbox fanboy I kind of want to see a legal drama play out where they air Sony's dirty laundry in public.

Something I'm wondering as MS has a history of this shit.

@lamprey263: Forgit about all those subpoenas MS served Sony with, so i'm with you and would like to see Sony's dirty laundry aired in court, but the rest of this stuff is boring af and don't really care of the outcome.

As I was saying before, it's not just the UK. Both the US and UK are trying to block it, due to being the two largest Xbox markets.

So will MS and COD boycott the US of A then as well as the UK?

@Chutebox: Hey, we still have the shitty paper staws to grasp at.

"Would love to know who's palms MS greased in both EU and US systems."

They really don't need to unfortunately. The laws to block this just aren't there. It's nice to see someone running the FTC who actually wants to do their job, but congress has to give them more teeth if anything is going to happen. Need to move beyond blocking monopolies, and start breaking up corporations for being just too damn big.

TC didn't read his OWN link.

"In light of that, and public reporting that Microsoft and Activision Blizzard are considering closing their deal imminently, we have filed a request for a temporary restraining order to prevent them from closing while review continues.”

Shortly after the FTC confirmed it requested a temporary restraining order to prevent the deal from happening, Activision Blizzard CEO Bobby Kotick published a letter saying that the action was "a welcome update and one that accelerates the legal process." Kotick noted towards the end that the company is "ready to present [its] case to a federal judge who can evaluate the transaction on the merits."

Microsoft's vice chair and president, Brad Smith, tweeted out a response to the FTC's action, emphasizing that the FTC's decision should "accelerate the decision-making process."

Today’s action by the FTC to file suit in our Activision case in federal court should accelerate the decision-making process. This benefits everyone. We always prefer constructive and amicable paths with governments but have confidence in our case and look forward to presenting…

— Brad Smith (@BradSmi) June 12, 2023"

Well looks like cows just cant seem to get a break :(

@jcafcwbb: They can't boycott the USA, as that's their home base. If the FTC don't accept, then the deal is off.

Update (6/13/23) -A federal court in California has issued a temporary restraining order requested by the FTC that effectively blocks Microsoft's $68.7 billion deal to acquire Activision Blizzard for the time being.

As reported by The Verge, the court in question agreed to issue the restraining order requested by the FTC as it considers the a preliminary injunction that would allow the FTC to make a legal case against Microsoft before the deal could be completed.

“Accelerating the legal process in the US will ultimately bring more choice and competition to the gaming market,” Microsoft spokesperson David Cuddy said in a statement to The Verge. “A temporary restraining order makes sense until we can receive a decision from the Court, which is moving swiftly.”

This order means Microsoft and Activision can not complete the deal until "after 11:59pm Pacific Time on the fifth business day after the Court rules on the FTC's request for a preliminary injunction" or, if it's later, a date set by the court.

As for the preliminary injunction, an evidentiary hearing on the matter will take place on June 22 and 23, and Microsoft and Activision will be able to "submit their brief in opposition to the motion for preliminary injunction by June 16, 2023." The FTC will then be able to submit its reply by noon on June 20.

It's important to note that the Microsoft and Activision deal would need to close before July 18, 2023, or the two parties will need to renegotiate. If they don't agree to new terms, Microsoft will need to pay Activision Blizzard a $3 billion breakup fee.

https://www.ign.com/articles/microsofts-acquisition-of-activision-blizzard-has-been-temporarily-blocked-by-a-restraining-order-from-the-ftc

Oh no!

Anyway...

@Archangel3371:

Poo cows. lol :P

Looks like this is great news for MS and their closing of the deal. Bummer this backfired on the TC.

@Pedro: Ah, much better! 👍😅

I hope uncle Phil is ok.

@SecretPolice said:

Poo cows. lol :P

They have two months of praying and hoping that Starfield flops. 😂

@Pedro said:

@SecretPolice said:

Poo cows. lol :P

They have two months of praying and hoping that Starfield flops. 😂

LOL more like praying that MS buys activison by 2030🤣

After that, all they need is two more companies.

This is exactly what MS wants, after they beat the FTC in federal court in a few weeks (and they will quite easily) the FTC is out of the picture regarding this transaction leaving the CMA alone

MS can either close around the CMA, or the CMA chances of winning in the CAT appeal drop to under 5%