Microsoft and the FTC head to court

 

Starting today, Microsoft is facing a five-day court case against the Federal Trade Commission (FTC) over its $68.7B acquisition of Activision Blizzard.  The CEOs of both companies, along with other executives, will testify in federal court to defend the deal against antitrust concerns. The outcome of the case, expected in the coming weeks, will likely determine the fate of the deal. The FTC is seeking a preliminary injunction to temporarily halt the merger. If granted, it would stop the deal from closing before the government's antitrust case against it is heard later this year. It could also force Microsoft and Activision to extend the deal beyond the original termination date of July 18. If Microsoft fails to finalize it by then, it will have to pay Activision Blizzard $3B in breakup fees. The latest hearings, presided over by U.S. District Judge Jacqueline Scott Corley, will involve testimonies from Microsoft CEO Satya Nadella and Activision Blizzard CEO Bobby Kotick. The FTC argues that the merger would give Microsoft an unfair advantage and stifle competition, while Microsoft sees it as an opportunity to expand its gaming imprint beyond the Xbox console. Sony, a key rival, has been actively opposing the merger, providing evidence to regulatory bodies.