Microsoft's Acquisition of Activision Blizzard Temporarily Halted by US Judge, FTC's Request Granted

In a significant development, US District Judge Edward Davila has granted the Federal Trade Commission's (FTC) request to temporarily halt Microsoft's acquisition of video game maker Activision Blizzard. 

The judge has also scheduled a two-day evidentiary hearing on the FTC's request for a preliminary injunction, which will take place on June 22-23 in San Francisco. This decision prevents Microsoft from finalizing the $69 billion deal as early as Friday.

The FTC, responsible for enforcing antitrust law, initially aimed to block the transaction in December and an evidential hearing in the administrative proceeding is set to commence on August 2.

Following the late-June hearing, the court will determine whether a preliminary injunction, lasting for the duration of the administrative review, is necessary. The FTC filed for the temporary block on Monday.

Judge Davila emphasized that the temporary restraining order is crucial to maintain the status quo while the complaint is pending. It ensures the court's ability to order appropriate relief if a preliminary injunction is deemed warranted and preserves the FTC's ability to obtain an effective permanent remedy if successful in the ongoing administrative proceeding.

Microsoft and Activision are required to submit legal arguments opposing the preliminary injunction by June 16, while the FTC has until June 20 to respond.

Activision expressed its support for the FTC's decision on seeking a federal court order and expediting the legal process, while Microsoft believes that accelerating the process would introduce more choice and competition to the gaming market.

The FTC argues that the acquisition would grant Microsoft's Xbox exclusive rights to Activision games, potentially excluding Nintendo and Sony's PlayStation from accessing these titles.

While the European Union approved Microsoft's bid in May, British competition authorities blocked the takeover in April.

Microsoft maintains that the deal would benefit gamers and gaming companies alike and has offered to sign a legally binding consent decree with the FTC, ensuring the availability of "Call of Duty" games to competitors, including Sony, for the next decade.

Sources : BY MSN