US Government File Lawsuit Over Microsoft’s Planned Takeover of ‘Call of Duty’ Franchise

The United States FTC have filed a lawsuit to block Microsoft’s pending acquisition of Activision due to concerns that it would harm the gaming market.

Microsoft’s ongoing acquisition of major video game publisher Activision, best known for the Call of Duty franchise, has been a long and winding saga. On December 8 the saga has taken an unexpected turn as the United States Federal Trade Commission filed a lawsuit in the hopes of blocking the deal from going through.

The unprecedented $69 billion acquisition was set to shake the gaming industry as one of the biggest of its kind. However, the deal is now in major jeopardy of crossing the finish line.

Due to the scale of the deal, the Federal Trade Commission, whose main goal is to enforce antitrust law and look out for consumer protection, had a role to play in the acquisition.

On December 8, The Washington Post reported that the FTC would be filing a lawsuit to block Microsoft’s acquisition. The FTC deemed that the deal would be harmful to the growing gaming market as Microsoft would be capable of suppressing and crushing any competition.

Microsoft’s previous acquisition of Bethesda had a major factor in the FTC’s decision to file a lawsuit. The FTC noted that Microsoft ensured regulators that they’d keep Bethesda games multi-platform accessible, only to later change their minds and make them exclusive.

Given the storied success of the Call of Duty franchise, which would fall under Microsoft’s jurisdiction if the purchase of Activision were to go through, concerns of a similar exclusivity were at the forefront of the FTC’s decision.

While Microsoft have been outspoken about their desire to offer Call of Duty on multiple platforms including going as far as striking a 10-year deal with Nintendo, this wasn’t enough to sway the FTC.

Microsoft were quick to respond to the lawsuit with the following statement: “While we believed in giving peace a chance, we have complete confidence in our case and welcome the opportunity to present our case in court.”

Clearly, there will be more to this story as the parties involved are due to appear in court.

It seems as though another major issue that could prevent the deal from going through is the length of court proceedings. Microsoft & Activision Blizzard have until June 2023 to close the deal. The deal must be re-negotiated, further putting it in danger if it isn’t complete by then.

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