Microsoft asks court to reject FTC request to pause Activision deal

WASHINGTON (Reuters) – Microsoft urged an appeals court in sometimes scathing language on Friday to reject the U.S. Federal Trade Commission’s (FTC) request to pause its $69 billion deal to buy Activision.

The agency asked the 9th Circuit Court of Appeals late on Thursday to require the companies to delay consummating the transaction while the court considered the FTC’s broader appeal.

Microsoft said on Friday the agency had been slow to file in federal court, and thus it was inappropriate to press for a delay so late in the game.

“The Court should not mistake the FTC’s litigation gamesmanship for an emergency meriting this Court’s deviation from the ordinary appellate process,” the company wrote.

Microsoft also took issue with the FTC’s assertions that Judge Jacqueline Scott Corley in San Francisco erred in her ruling in disagreeing the deal would hurt gamers who use consoles. “The district court’s consideration of the FTC’s primary claim at trial shows that the court did not misapply the law,” Microsoft said.

The FTC had argued that Microsoft would have the incentive to hoard Activision games like “Call of Duty,” the best selling game of all time, for its Xbox and subscription service, hurting rivals like Sony, which sells the PlayStation console, and, ultimately gamers.

Legal experts have said the agency faced an uphill fight in convincing the appeals court to overturn Corley’s ruling.

The deal has also not wrapped up approval in Britain, where the Competition and Markets Authority had received “detailed and complex” proposals from the companies hoping to resolve the agency’s antitrust concerns. The antitrust regulator set a deadline of Aug. 29 for a decision.

The fight was the second time that the FTC during the Biden administration sought to prevent a Big Tech firm from buying a content company, and the second time it lost in court. The first was Meta’s purchase of virtual reality content maker Within Unlimited.