Video games sue Microsoft in US court to stop Activision takeover | CNN Business
Microsoft Corp was hit in U.S. court on Tuesday with a private consumer lawsuit that claims the tech company’s $69 billion bid to buy “Call of Duty” maker Activision Blizzard Inc will illegally suppress competition in the video game industry.
The complaint filed in California federal court comes about two weeks after the U.S. Federal Trade Commission filed a case with an administrative law judge seeking to block Microsoft, owner of the Xbox console, from completing the largest acquisition never done in the video game market. .
The private lawsuit also seeks an order preventing Microsoft from acquiring Activision. It was filed on behalf of 10 video game players in California, New Mexico and New Jersey.
The proposed acquisition would give Microsoft “grossly disproportionate market power in the video game industry,” according to the complaint, “with the ability to foreclose rivals, limit output, reduce consumer choice, raise prices and inhibit even more competition.”
A Microsoft representative did not immediately comment Tuesday. After the FTC’s lawsuit, Microsoft President Brad Smith said, “We have complete confidence in our case and welcome the opportunity to present our case in court.”
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 harm consumers in the long term.”
Private plaintiffs can bring antitrust claims in U.S. courts, even while a case involving a U.S. agency is pending. The acquisition, announced in January, also faces antitrust scrutiny in the European Union.
The FTC previously said it sued to prevent “Microsoft from gaining control of a leading independent game studio.” The agency said the merger would hurt competition between rival game platforms from Nintendo Co Ltd and Sony Group Corp.