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F.T.C. Sues to Block Microsoft’s $69 Billion Acquisition of Activision


The F.T.C. sued in July to dam Meta, Facebook’s parent company, from buying a virtual reality start-up for $400 million in a case drawing on little-used legal arguments. A judge began a multiday hearing within the case on Thursday that would determine the fate of the F.T.C.’s suit.

When Microsoft announced the deal to amass Activision in January, it said it desired to get a toehold in mobile gaming, where Microsoft barely competes, and acquire a studio that produces hugely popular games, which might make its consoles and game subscription service more appealing. Microsoft’s powerful computing infrastructure and deep pockets make it a frontrunner within the gaming space, however it has struggled to supply hit titles at the identical rate as Sony or Nintendo.

Phil Spencer, chief executive of Microsoft’s video game business, called Call of Duty “one among the amazing entertainment franchises on the planet.”

Microsoft indicated approvals could be a considerable hurdle, and told investors it could take 18 months to shut. It agreed to pay as much as $3 billion to Activision if the deal falls apart.

Microsoft pursued Activision when the sport maker was a troubled company, reeling from a lawsuit filed by a California regulator that accused it of fostering a toxic workplace culture wherein women were routinely sexually harassed. For months, Activision employees staged intermittent walkouts and a few top executives departed.

Ms. Khan has taken a greater interest in scrutinizing how mergers could hurt employees, and the Communications Staff of America, which had been organizing employees at Activision, initially expressed reservations concerning the deal. In June, Microsoft announced an agreement with the union where it promised to not oppose unionization at Activision.

In October, the union’s president, Chris Shelton, met with Ms. Khan to praise Microsoft’s commitment to stay neutral in union campaigns and said the deal needs to be approved. In an opinion piece in The Hill on Monday, Mr. Shelton wrote that approving the deal “would send a game-changing message to corporate America” that labor concerns matter.

Kellen Browning contributed reporting.

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