The Federal Trade Commission (FTC) has launched an appeal against the Microsoft-Activision deal – despite the deal already being completed for $68.7 billion in October.
As Reuters reported, lawyers representing the FTC and Microsoft stood before a panel yesterday in the Ninth Circuit US Court of Appeals.
The FTC’s main argument was that district judge Jacqueline Scott Corley was too stringent with the FTC in denying their appeal for a preliminary injunction. Imad Abyad, a lawyer on behalf of the FTC, argued they merely had to demonstrate the potential for Microsoft to withhold games from other platforms; rather than show the deal discouraged competitiveness in the market.
Continuing, Abyad gave examples from the past of Microsoft doing this – when they acquired Zenimax in 2020 – which led to some of their titles being exclusive to Microsoft.
As CNN reported Abyad’s argument: “I fail to understand how giving somebody a monopoly of something would be pro-competitive…It may be a benefit to some class of consumers, but that is very different than saying it is pro-competitive.”
However, the attorney representing Microsoft – Rakesh Kilaru argued that the court’s decision was based on “clear factual findings” and “that the world will be better with the merger.”
“It is not a violation of the antitrust laws to give consumers something new, that’s beneficial…unless they present some evidence of it, which they didn’t do.”
In a counterargument, Abyad raised the issue of licensing agreements – which Microsoft has produced in vast numbers in response to regulator critique – would give the courts more to examine in the case, yet they have already made their decision.
He said: “What the district court relied on, mostly, are contracts that were entered into after the (FTC) complaint was filed…”
“The facts were changing all along. Even after the district court decided the case, Microsoft went ahead and entered into yet another contract (to restructure the cloud licensing rights).”