Video gamers sue Microsoft over $69 billion Activision deal

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Microsoft Corp.’s planned $68.7 billion acquisition of “Call of Duty” maker Activision Blizzard Inc. hit another hurdle on Tuesday, when a group of gamers challenged the deal in court, claiming the purchase would unlawfully suppress competition in the video game industry.

The federal antitrust lawsuit, filed in San Francisco, comes less than two weeks after the Federal Trade Commission filed a lawsuit to overturn the merger between Activision Blizzard, one of the world’s top video game publishers, and Microsoft, the Xbox console maker. , to block.

The Microsoft logo can be seen on a smartphone superimposed on the Activision Blizzard logo shown in this illustration taken on January 18, 2022. (REUTERS/Dado Ruvic/Illustration/Reuters)

The private lawsuit was filed on behalf of 10 video game players in California, New Mexico and New Jersey.

As with the FTC case, the gamers are seeking an injunction to prohibit the companies from going through with the merger, nullify the severance payment, and pay their legal fees.

The gamers’ lawsuit alleges that the merger would violate the Clayton Antitrust Act by reducing competition in the gaming industry and, by extension, harming the public.

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Their complaint refers to concerns that the union would give Microsoft power over multiple levels of the gaming industry “to exclude rivals, limit output, reduce consumer choice, raise prices and further inhibit competition .”

Call of Duty view

Activision games “Call of Duty” are pictured at a store in the Manhattan borough of New York City, New York, U.S., January 18, 2022. (REUTERS/Carlo Allegri/File Photo / Reuters Photos)

“Microsoft has already shown that it can and will withhold content from its gaming rivals,” Holly Vedova, director of the FTC’s Bureau of Competition, wrote in a press release. “Today, we’re trying to prevent Microsoft from taking control of a leading independent game studio and using it to harm competition in multiple dynamic and fast-growing gaming markets.”

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A Microsoft representative on Tuesday defended the deal, saying in a statement that it “will increase competition and create more opportunities for gamers and game developers.”

After the FTC lawsuit, Microsoft president Brad Smith said, “We have complete confidence in our case and welcome the opportunity to take our case to court.”

Call of Duty character on an in-game zipline

A Call of Duty character hangs on a wall in a stairwell at Activision Blizzard, Infinity Ward Division, in Woodland Hills, California, on Friday, October 21, 2022. (AP Photo / Allison Dinner / AP Images)

In a statement, plaintiffs’ attorney Joseph Saveri in San Francisco said, “As the video game industry continues to grow and evolve, it is critical that we protect the market from monopolistic mergers that will harm consumers in the long run. “

Private plaintiffs can bring antitrust claims in U.S. courts even while a related U.S. agency case is pending.

The acquisition, announced in January, is also facing cartel investigations in the European Union.

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Reuters contributed to this report.

The Valley Voice
The Valley Voicehttp://thevalleyvoice.org
Christopher Brito is a social media producer and trending writer for The Valley Voice, with a focus on sports and stories related to race and culture.

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