FTC Goes To Appeals Court After Judge Corley Rejects Motion To Block MS Deal Again

FTC’s appeal to block the Microsoft Activision deal was just rejected by District Judge Jacqueline Scott Corley.

As reported by CharlieIntel, Judge Corley has simply written this text in reaction to FTC’s motion for appeal:

“The FTC asks this Court to enjoin the merger at issue pending resolution of the FTC’s appeal to the Ninth Circuit Court of Appeals. (Dkt. No. 313.) The motion is denied.”

To be clear, the FTC added an extra request in light of their pending appeal, to add another block to the deal again. As expected, Judge Corley has rejected that request, and the appeal now goes to the 9^th Circuit Court. As for why they asked for another block, we’ll explain that in detail below.

Florian Mueller confirmed that FTC submitted documentation to the 9^th Circuit Court at 7 PM, just two hours after Judge Corley posted the above decision. The FTC now has less than 24 hours and counting to get the 9^th Circuit Court to accept their appeal. 

Microsoft and Activision have yet to submit their opposition to the appeal. Depending on how effective their arguments are, they could immediately sway the court to reject the FTC’s appeal and end the case then and there.

Now, there are multiple reasons for the appeals court to reject the FTC’s motion. One of these is that the FTC, like the CMA, can make Microsoft divest from Activision after the fact; AKA they can force the two companies to break up their merger later.

By pushing their case at the moment, however, the FTC is seeking to establish a harmful precedent. They want to be able to kill any merger without an effective judicial review.

As Florian explains it, if the appeals court sides with the FTC, establishing this precedent, this case could go all the way to the Supreme Court. Now, the FTC under its current management, has also recently lost cases with the Supreme Court.

So we’re in a situation where the FTC insists in blocking or delaying this deal, so much so that they’re trying to change how the laws work, to get their way. Even if these efforts ultimately fail, it should be noted that they’ve thrown caution and sense to the wind with their choices.

In any case, the decision to their appeal should come in within today. If that appeal gets denied, then Microsoft and Activision are free to complete their deal Monday the next week, though there is speculation they’ll pursue completing the process this Saturday.