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On May 7, 2025, the U.S. Court of Appeals for the Ninth Circuit affirmed a lower court’s refusal to block Microsoft’s acquisition of Activision Blizzard. The deal had already closed in October 2023, so the ruling did not newly authorize Microsoft to complete it. The FTC later dismissed its remaining administrative complaint on May 22, 2025.
What the Ninth Circuit decided
In FTC v. Microsoft, No. 23-15992, a three-judge Ninth Circuit panel affirmed the Northern District of California’s denial of the FTC’s request for a preliminary injunction. The panel comprised Judges Daniel P. Collins, Danielle J. Forrest, and Jennifer Sung. Read the Ninth Circuit opinion.
The FTC had sought an order temporarily preventing Microsoft from closing the acquisition while its separate administrative case proceeded. For that preliminary relief, the FTC had to show a sufficient likelihood of success on its claims. The appeals court concluded that it had not made that showing and that the district court had applied the correct legal standards. This was an appellate ruling on the denial of preliminary relief, not a general regulatory approval or a final judgment declaring every aspect of the transaction lawful.
What the FTC argued
The FTC’s challenge focused on whether Microsoft’s ownership of Activision Blizzard’s games could let it disadvantage competitors in console gaming, subscriptions, and cloud gaming. Its concerns included both Microsoft’s ability to restrict rivals’ access to valuable content and its incentive to do so. The FTC’s case summary describes the alleged risk to rival consoles and competing subscription and cloud-gaming businesses.
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Console access and Call of Duty
The FTC argued that Microsoft could make Call of Duty exclusive to Xbox or provide competitors with an inferior version. The Ninth Circuit concluded that the FTC had not established the required likelihood of success on its claims that Microsoft would block rivals from accessing the franchise or release a materially inferior PlayStation version.
Game-library subscriptions
The FTC also argued that Activision content could strengthen Xbox Game Pass at the expense of competing subscription services. The panel found that the FTC had not shown a sufficient likelihood of proving that the acquisition would substantially lessen competition in gaming subscription services.
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Cloud gaming
The FTC alleged that Microsoft could withhold or degrade Activision games on rival cloud-streaming platforms. The panel likewise found the FTC had not demonstrated a sufficient likelihood of success on its cloud-gaming theory.
How Microsoft’s commitments figured in the dispute
The district court considered Microsoft’s commitments to continue making Call of Duty available on rival platforms and to provide Activision titles through cloud-gaming arrangements. The appellate court assessed whether the FTC’s evidence and arguments overcame those commitments and supported its prediction of foreclosure.
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These commitments informed the court’s assessment of the FTC’s preliminary-injunction request; they should not be read as a blanket promise that every Activision title will remain on every competing platform, in every territory, or under every future business model. The opinion resolved whether the FTC had met the legal threshold for this requested injunction, not how Microsoft must make each future release or subscription decision.
Why the headline says “once again”
The May 2025 opinion followed an earlier emergency decision in the same dispute. In July 2023, after the district court denied the FTC’s injunction request, the FTC asked the Ninth Circuit to stop the transaction while its appeal proceeded. The appeals court denied that emergency request on July 14, 2023. In May 2025, it ruled on the appeal itself and affirmed the district court’s denial.
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| Date | What happened |
|---|---|
| January 18, 2022 | Microsoft announced its proposed acquisition of Activision Blizzard for approximately $68.7 billion, commonly rounded to about $69 billion. FTC case record |
| December 8, 2022 | The FTC authorized an administrative complaint challenging the proposed merger. FTC case record |
| June 12, 2023 | The FTC sought a preliminary injunction in federal court to prevent closing while its administrative case proceeded. FTC case record |
| July 10, 2023 | District Judge Jacqueline Scott Corley denied the preliminary injunction. FTC procedural order |
| July 14, 2023 | The Ninth Circuit denied the FTC’s emergency request to stop the transaction during the appeal. FTC procedural order |
| October 2023 | Microsoft completed the acquisition. Engadget |
| May 7, 2025 | The Ninth Circuit affirmed the denial of the FTC’s preliminary-injunction request. Ninth Circuit opinion |
| May 22, 2025 | The FTC dismissed its administrative complaint and closed that proceeding. FTC dismissal order |
Why a post-closing appeal still mattered
Microsoft had completed the transaction before the Ninth Circuit issued its opinion, but the FTC’s appeal and administrative case were still active. The May 2025 ruling resolved the federal appeal over preliminary relief; the later FTC order formally ended the separate administrative proceeding. In its May 22 dismissal order, the Commission said that, after the Ninth Circuit’s decision, the public interest was best served by dismissing the administrative litigation.
What the ruling does—and does not—settle
The decision ended the FTC’s effort to obtain a preliminary injunction in this federal appeal, and the Commission subsequently dismissed its administrative complaint. It does not establish that vertical mergers are generally lawful, determine whether consumers benefited from this transaction, or resolve every possible future antitrust claim involving Microsoft, Xbox, Activision, Game Pass, cloud gaming, or Call of Duty.
Nor does it guarantee the future availability, timing, or pricing of Activision games on competing consoles, subscription services, or cloud platforms. Those questions involve separate business decisions. The ruling concerns U.S. federal antitrust proceedings; it does not itself resolve the regulatory treatment of the acquisition in other jurisdictions.
Why the decision matters beyond this deal
The case illustrates the evidentiary challenge for the government in seeking to block a vertical merger at the preliminary-injunction stage. In this dispute, the FTC needed to show a sufficient likelihood that Microsoft would use control of Activision content to foreclose rivals and that the alleged effects supported the requested relief. Legal commentary has described the result as reinforcing the hurdle for vertical-merger challenges, but it is not a categorical rule against blocking such transactions. MLex analysis.
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