Microsoft Says it Could Abandon Activision Deal if Judge Delays It

Ms. Wilkinson also argued that it would be nonsensical for Microsoft to remove Call of Duty and other titles from other platforms, such as Sony’s PlayStation, because the company would lose out on a huge chunk of the game’s revenue. She said Sony had become the “complainer-in-chief” in the case, and showed an email from Sony’s chief executive, Jim Ryan, suggesting that he did not really believe Microsoft would withhold Call of Duty.

The F.T.C. has in another lawsuit accused Meta, Facebook’s parent company, of cutting off nascent competitors when it bought Instagram and WhatsApp. On Wednesday, it sued Amazon over allegations that the company tricked users into signing up for its Prime subscription service. But the F.T.C. has had setbacks: Earlier this year, its challenge to Meta’s purchase of a virtual reality start-up fell apart after a judge declined to stop the deal from closing.

The F.T.C. initially challenged Microsoft’s bid for Activision using an in-house court. But that court does not have the legal authority to stop the deal. The F.T.C. asked the U.S. District Court for the Northern District of California to step in earlier this month, saying it feared Microsoft would try to complete the deal despite the legal challenges.

The hearing in Judge Corley’s courtroom could be a decisive test for the F.T.C. If Microsoft wins, it would signal that there are weaknesses in the F.T.C. case and could cause the agency to drop its challenge to the deal. But a win for the F.T.C. could be a sign that its broader challenge has legs, and could put new pressure on Microsoft and Activision to reconsider the multibillion corporate marriage.

Sony, whose PlayStation console competes against Microsoft’s Xbox, has been a vocal critic of the deal. Sony argues that PlayStation gamers could lose access to Call of Duty — a massive franchise that has earned more than $30 billion in lifetime revenue — if Microsoft decided to make the game exclusive to Xbox. Microsoft has denied that it would do so.

Though most governments around the world, including the European Union, have approved the acquisition, Microsoft was dealt a setback in April when a British regulatory authority blocked it. That decision is under appeal.

The high-profile list of witnesses expected to testify before Judge Corley over the next week includes Satya Nadella, the chief executive of Microsoft; Amy Hood, the company’s chief financial officer; Bobby Kotick, the chief executive of Activision; and Phil Spencer, the chief executive of Microsoft’s Xbox unit. Mr. Ryan, the chief executive of Sony, will appear via a prerecorded video deposition.


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