Microsoft has been hit with a consumer lawsuit in a US court, alleging that their $69 billion bid to acquire Activision Blizzard, the maker of Call of Duty, will stifle competition in the video game industry.
This complaint, filed in federal court in California, comes just two weeks after the US Federal Trade Commission (FTC) filed a case seeking to block Microsoft, the owner of the Xbox console, from completing this major acquisition in the gaming market.
The private lawsuit, representing 10 video game players from California, New Mexico, and New Jersey, also seeks an injunction to prevent Microsoft from acquiring Activision.
According to the complaint, this proposed acquisition would give Microsoft “significant market power in the video game industry,” enabling them to suppress competitors, control supply, limit consumer choice, raise prices, and further impede competition.
A Microsoft spokesperson did not provide an immediate comment on Tuesday. However, after the FTC lawsuit, Microsoft President Brad Smith expressed confidence in their case and welcomed the opportunity to present it in court.
In a statement, Joseph Saveri, the attorney representing the plaintiffs in San Francisco, emphasized the need to protect the market from monopolistic mergers that would ultimately harm consumers as the video game industry continues to grow and evolve.
It is worth noting that private plaintiffs are allowed to pursue antitrust claims in US court, even when a related case involving a US agency is ongoing. Additionally, this acquisition, announced in January, is also undergoing antitrust scrutiny in the European Union.
The FTC previously stated that it sued to prevent Microsoft from gaining control over a leading independent game studio, as this merger would negatively impact competition among rival gaming platforms such as Nintendo and Sony Group.
© Thomson Reuters 2022
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