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.
(Bloomberg) — 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 Ninth Circuit Court of Appeals in San Francisco to overturn a lower-court judge’s July 10 order that cleared the companies to proceed toward their July 18 closure deadline.
“Consummation of the proposed deal would irreversibly alter the status quo and, if done before the merits of the FTC’s appeal are heard, would irreparably harm the FTC’s ability to order effective relief for the public should the deal prove to be in violation of the antitrust laws,” FTC lawyers wrote in the filing Thursday.
US District Judge Jacqueline Scott Corley earlier Thursday rejected the FTC’s request that she extend a pause on the deal while the appeal proceeds. Barring action by the appeals court, Microsoft and Activision can complete the deal as of 11:59 p.m. in San Francisco on July 14.
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.
FTC Chair Lina Khan defended the agency’s decision to appeal the ruling earlier Thursday during a House Judiciary Committee hearing. Republicans criticized the FTC’s record of merger losses, asking if she was “losing on purpose” to influence Congress to pass antitrust legislation.
“We fight hard when we believe there is a law violation,” she said. “When we get an adverse ruling, our teams look closely at the text of opinion and see if there are errors on matters of law that warrant an appeal.”
Read More: FTC’s Khan Branded ‘Bully’ in GOP Attack Over Deals, Ethics
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 limbo with the UK’s Competition and Markets Authority after that agency vetoed the deal in May.
Read More: Microsoft Cleared to Buy Activision in US as UK Pauses Fight
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.
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