Microsoft defeats gamers’ US court challenge to $69 billion Activision acquisition. Microsoft Corp (MSFT.O) avoided an early legal hurdle in its $69 billion acquisition of “Call of Duty” videogame producer Activision Blizzard Inc (ATVI.O) when a U.S. judge on Friday refused to let gamers in a private complaint to stop the acquisition preliminarily.
Microsoft was sued in December by private plaintiffs in California federal court to halt the acquisition, which they claimed anti-competitive.
In a late Friday night order, U.S. District Judge Jacqueline Scott Corley in San Francisco federal court stated the video gamers had not proven they would be “irreparably harmed” if the merger went forward.
The merger will benefit customers, according to Microsoft and its lawyers.
Corley refuted the gamers’ claim that Microsoft would limit the game’s distribution. In addition, Corley noted that the judge found no evidence that Microsoft could break current “Call of Duty” versions after the merger.
“The day after the merger they can play exactly the same way they played with their friends before the merger,” wrote Corley. Before ruling on the deal’s merits, the court remarked “it is not likely” Microsoft will make any newer “Call of Duty” exclusive to its platform.
Microsoft did not respond to a request for comment on Monday.
On Monday, the gamers’ lawyer stated they would continue to dispute the deal despite losing this preliminary stage.
The court decided a preliminary injunction “was not necessary at the moment,” but Joseph Alioto stated the “evidence is very strong” that the proposed transaction breaches U.S. antitrust law.
The court’s order follows Microsoft’s E.U. antitrust approval. China, South Korea, and the U.S. Federal Trade Commission are reviewing the deal.
British competition authorities rejected the gambling industry’s largest agreement. The appeal deadline for Microsoft is May 24.
U.S. antitrust law allows private individuals to prosecute over mergers and acquisitions.
In March, Corley dismissed the gamers’ initial case, stating that plaintiffs had not shown sufficient evidence that the purchase violated U.S. antitrust law.
The plaintiffs could change their complaint. Microsoft is appealing the case.
Microsoft Corp. v. DeMartini, U.S. District Court, Northern District of California, No. 3:22-cv-08991.
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