Judge Agrees Microsoft Might Not Keep Its Promises But Dismisses Gamers' Lawsuit Trying To Block Activision Sale
"Why would Microsoft make Call of Duty exclusive to its platforms thus resulting in fewer games sold?"
A judge has dismissed a class-action lawsuit brought forth by regular everyday gamers that was attempting to block Microsoft's proposed purchase of Activision Blizzard and the Call of Duty series.
District judge Jacqueline Scott Corley handed down judgment on Monday, saying the plaintiffs failed to make their case based on the rule of law. "The complaint does not plausibly allege the merger creates a reasonable probability of anticompetitive effects in any relevant market," Corley said.
The judge took issue with alleged concerns that Microsoft's buyout would have "anticompetitive effects" by making games like Call of Duty exclusive to Microsoft platforms.
"While plaintiffs allege Microsoft might obtain the ability to make Activision's games exclusive, and they assert Microsoft would have an incentive to do so, they do not make any factual allegations that support the conclusory incentive assertion. Why would Microsoft make Call of Duty exclusive to its platforms thus resulting in fewer games sold?" Corley said. "What is it about the console market or PC games market and Microsoft's position in those markets that makes it plausible there is a reasonable probability Microsoft would take such steps."
This is what Microsoft itself has been saying for a long time, which is that it makes no business sense to remove Call of Duty from PlayStation.
Corley also took issue with the allegation that a merger could lead to higher prices, less innovation, less creativity, less consumer choice, decreased output, and other anticompetitive effects. The plaintiffs' claim was "insufficient," Corley said, adding that the plaintiffs failed to explain why and how any of that would be true.
The plaintiffs also claimed that Microsoft's past behavior of failing, by their estimates, to keep promises to regulators was another reason the deal should not be allowed to go through. The plaintiffs said Microsoft told the European Commission when it was trying to buy ZeniMax that it would not have an incentive to "cease or limit" ZeniMax games for non-Microsoft platforms.
The plaintiffs said Microsoft ran afoul of this promise when it announced future ZeniMax games like Starfield and Redfall would be exclusive to Xbox on console. But Corley said these claims "fall short of plausibility."
Corley said the plaintiffs may be right in that Microsoft doesn't always tell the full and complete truth in its public statements, but that's not enough to prove a legal case.
"While the allegations support an inference Microsoft is willing to break its public promises, why would it do so as to Call of Duty? The complaint does not allege facts that support a plausible inference it is reasonably probable it will do so," Corley said.
"Is it possible Microsoft will make Activision's game catalog fully or partially exclusive? Yes. Have plaintiffs alleged facts that make it plausible Microsoft is reasonably likely to do so? Without more factual context, no," the judge added.
The plaintiffs have 20 days to make a new case. The dismissal was first reported by Florian Mueller.
While Microsoft may have succeeded in getting this class-action suit tossed out, the company still needs to clear regulatory hurdles in America, Europe, and other places around the world.