Microsoft & Activision Accuse FTC of "Litigation Gamesmanship" and Having "Created" an Emergency

Published: July 14, 2023 2:13 PM /


Phoenix Wright Objects Litigation Between FTC, Microsoft, and Activision Blizzard

As the endless saga continues, Microsoft and Activision have filed a firm rebuttal of the FTC's motion for an injunction pending its appeal to the 9th Circuit Court of Appeals. 

According to the document shared by FOSS Patents Blog founder Florian Mueller, the counsel for the two companies attacked not only the merits of the FTC's request for an injunction, but also the timeline of the regulator's actions.

We read that the FTC failed to disclose until the last paragraph of its motion that the merger has an expiration date of July 18, 2023 (four days from now) and omitted entirely the fact that Microsoft would have to pay a $3 billion termination fee if the merge doesn't close due to regulatory obstacles among other things.

On top of that, according to Microsoft and Activision's counsel, the emergency the FTC claims to receive the injunction is "entirely of its own creation." The companies notified the regulator of the merger on February 1, 2022. The FTC filed its complaint challenging the acquisition on December 8, 2022. Yet, breaking from its standard practice in merger cases, it did not file a federal court complaint seeking a preliminary injunction at that time and it set its administrative hearing on August 2, 2023, after the expiration date of the merger.

The document continues accusing the FTC of having acted for the better part of a year and a half as though the case was not an emergency necessitating the intervention of a federal court. The parties and the court now face a time crunch only because the FTC did not ask the Federal Court for the preliminary injunction until June 12, 2023, less than six weeks before the termination date. 

In addition, Microsoft and Activision dispute the FTC's arguments for the reason why it couldn't file the motion of appeal earlier, since the District Court sent them its decision denying the preliminary injunction on the evening on Monday, July 10, giving the FTC more than four days to seek emergency relief before the expiration of the Temporary Restrictive Order at 11:59 p.m. PDT tonight. 

Yet, for reasons it did not explain, the FTC failed to file any emergency motion until July 13, well after the close of business hours, demanding an order granting extraordinary relief within 28.5 hours. 

Microsoft and Activision conclude by mentioning that "the court should not mistake the FTC's litigation gamesmanship for an emergency meriting this Court's deviation from ordinary appellate process."

If you're interested in reading more about the hearings that led to the Federal Judge's ruling against the FTC, which the agency is now appealing, you can read our summaries of the first daysecond day, third day, and fourth day (including Bobby Kotick and Satya Nadella's testimonies).

Yesterday, the agency's head Lina Khan received harsh criticism from three congressmen during an oversight about the regulator's conduct in trying to block the merger and the recent appeal. 


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