FTC Files Appeal And Seeks Emergency Stay On Microsoft Merger's Restraining Order That Expires Tomorrow

After taking quite the loss at the hands of Judge Jacqueline Scott Corley earlier this week, the Federal Trade Commission (FTC) has started the appeals process. Having initially been denied an emergency injunction that would have forced Microsoft and Activision to sit tight while the FTC's antitrust lawsuit took place, a decision that Microsoft said would 100% kill the deal if they had to wait, the FTC is asking the appeals court to review the ruling.

In addition, the FTC is seeking an extension to the current restraining order preventing the companies from completing their merge. That restraining order is set to expire tomorrow night, July 14th, at 11:59 PM PST according to Judge Corley's ruling.

The deal's deadline, according to the agreement between Microsoft and Activision, is only a few short days away on July 18th, as well. This means that the FTC is asking for an almost 24-hour turnaround time on an extention to the restraining order since an actual full appeals ruling is highly unlikely to be completed by the 18th. If the restraining order isn't extended, Microsoft and Activision could complete the merge early next week ahead of any appeal decision.

Courts can certainly expedite things, and may do exactly that in this large case, but even expedited, the deadlines are cutting things very close.

Lulu Cheng Meservey, CCO and EVP of Activision Blizzard Corporate Affairs, said in a tweet that "The facts haven't changed," and expressed confidence that the deal could proceed.

The facts haven’t changed. We’re confident the U.S. will remain among the 39 countries where the merger can close.

We look forward to demonstrating the strength of our case in court - again.

— Lulu Cheng Meservey (@lulumeservey) July 12, 2023

Microsoft President Brad Smith also told The Verge, "The District Court’s ruling makes crystal clear that this acquisition is good for both competition and consumers. We’re disappointed that the FTC is continuing to pursue what has become a demonstrably weak case, and we will oppose further efforts to delay the ability to move forward.”

All of this is on top of Microsoft and the CMA trying to smooth things out in the UK following the deal's rejection there. A process that could lead to the CMA feeling it would need to re-investigate things.