The US Federal Trade Commission (FTC) lost a lawsuit in a federal appeals court on Wednesday that decisively rejected the agency’s attempt to block Microsoft’s $69 billion acquisition of gaming giant Activision Blizzard. Following the ruling, the Trump administration has warned the antitrust enforcers not to continue “challenging” big tech technology mergers.
On May 7, a three-judge panel from the Ninth Circuit Court of Appeals unanimously denied the FTC’s motion for a preliminary injunction, ruling that the agency had failed to provide sufficient evidence that the merger would harm competition in the gaming industry.
The case, which stretched over nearly three years, ended in a legal rebuke of the FTC’s approach from Washington.
“The district court properly denied the FTC’s motion … given the FTC’s failure to make an adequate showing as to its likelihood of success on the merits as to any of its theories,” wrote Circuit Judge Daniel P. Collins in a 40-page decision.
Court demands evidence, not theories
According to court files submitted by the FTC, the agency claimed that the merger would reduce competition in game consoles, cloud gaming, and subscription content. It also alleged Microsoft could restrict access to Activision’s flagship title, “Call of Duty,” and harm rival console manufacturers like Sony’s PlayStation.
Yet, the court found those arguments unconvincing, since Microsoft made public commitments to keep “Call of Duty” on PlayStation for the next ten years. The court concluded that the concessions negated the FTC’s claims that Microsoft would use Activision for competitive harm.
Microsoft officially closed the deal in October 2023 after the district court declined to grant an injunction. The acquisition placed the company behind only Tencent and Sony in global gaming revenue, and ahead of Nintendo, making it the second-largest home console maker by revenue.
The deal brought major Activision franchises like “World of Warcraft,” “Diablo,” and “Overwatch” under Microsoft’s umbrella, alongside the mobile game publisher King, best known for “Candy Crush.”
In contrast to the Microsoft case, federal prosecutors have had more success in court with Google. The government has accused the search giant of monopolizing the online search and advertising markets through exclusionary practices.
FTC legal strategy questioned by President Trump
Just two months into his return to the White House, President Donald Trump fired two Democratic commissioners from the Federal Trade Commission (FTC). The dismissed commissioners, Alvaro Bedoya and Rebecca Kelly Slaughter filed a lawsuit challenging the firings and seeking reinstatement, which is yet to be decided by the US Supreme court.
They argue that the President lacks the authority to remove FTC commissioners at will because of the statutory protections in the Federal Trade Commission Act that allow removal only “for cause,” defined as inefficiency, neglect of duty, or malfeasance in office.
Trump’s investment agenda is heavy on big tech
Since taking office, the Trump administration claims to have secured over $3 trillion in new corporate investments. A large share of these projects are concentrated in technology-related industries, notably semiconductors, artificial intelligence infrastructure, and select commitments from Apple.
Trump has repeatedly said the investments validate his use of tariffs and other economic incentives. Speaking to a group of CEOs at an end-of-April White House event, the president reiterated that his trade policies are the reasons why several firms have made financial commitments.
“Intelligently used tariffs and various other forms of incentives have led to investments that are really amazing,” Trump told the assembled executives. The administration has posted a running tally of the projects on the White House website.
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This articles is written by : Nermeen Nabil Khear Abdelmalak
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