The US Federal Trade Commission (FTC) has been granted a restraining order against the Microsoft-Activision deal. This means the companies are now temporarily blocked from completing the merger.

Federal court grants the FTC's request to temporarily ban Microsoft-Activision Deal

On June 13, a federal judge in California granted the FTC’s request for a temporary restraining order, saying that it was necessary to maintain the status quo while the agency challenges Microsoft’s acquisition of Activision Blizzard.

According to a court order, the companies won’t be able to complete the proposed deal until “after 11:59 p.m. Pacific Time on the fifth business day after the Court rules on the FTC’s request for a preliminary injunction” or a “date set by the court, whichever is later.”

An evidentiary hearing on the preliminary injuction is now scheduled for June 22 and 23.

Microsoft spokesperson David Cuddy told The Verge that “a temporary restraining order makes sense until we can receive a decision from the Court, which is moving swiftly.”

The FTC’s decision to file for an injuction to prevent Microsoft from buying Activision Blizzard was first reported on June 12. The commission wanted to block the acquisition from being completed before its July 18 deadline. If the deal doesn’t close before this date, the companies will have to renegotiate, and if the merger eventually falls apart, Microsoft will also have to pay Activision a $3 billion fee.

As an FTC spokesperson told IGN, both parties failed to provide assurances taht they won’t try to close the deal until it is approved by all regulators (it was recently blocked by the UK’s CMA). “In light of that, and public reporting that Microsoft and Activision Blizzard are considering closing their deal imminently, we have filed a request for a temporary restraining order to prevent them from closing while review continues,” a statement reads.

Microsoft president Brad Smith then stated that the FTC’s move “should accelerate the decision-making process.” He also added that “we always prefer constructive and amicable paths with governments but have confidence in our case and look forward to presenting it.”

The FTC sued to block the $68.7 billion deal in December, with a trial expected to begin this August. On top of that, Microsoft is now also in the center of a legal fight with the CMA. The company recently appealed the regulator’s decision to block the merger, and a four-day hearing was set for July 17.

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