Microsoft sued by video gamers saying its deal to buy Activision will stifle competition

Microsoft was sued in a US court on Tuesday in a private consumer lawsuit claiming the tech company’s $69 billion (roughly Rs 5,71,200 crore) bid to buy Call of Duty maker Activision Blizzard would illegally suppress competition in the video game industry.

The lawsuit filed in federal court in California comes about two weeks after the U.S. Federal Trade Commission (FTC) filed a lawsuit with an administrative law judge seeking to restrain Microsoft, owner of the Xbox console, from achieve the largest acquisition ever in 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,” the complaint alleged, “with the ability to foreclose rivals, limit production, reduce consumer choice, ‘raise prices and further impede competition’.

A Microsoft representative did not immediately comment on Tuesday. After the FTC lawsuit, Microsoft Chairman 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 will harm long-term consumers.

Private plaintiffs can sue antitrust in a US court, even when a case related to a US agency is pending. The takeover, announced in January, is also subject to antitrust scrutiny in the European Union.

The FTC previously said it had filed a lawsuit to stop “Microsoft from taking control of a leading independent game studio.” The agency said the merger would hurt competition between rival games platforms Nintendo and Sony Group.

© Thomson Reuters 2022

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