Microsoft-Activision ruling represents setback for FTC chair Lina Khan

00:00

{"text":[[{"start":14.11,"text":"When a federal judge in California rejected the US Federal Trade Commission’s request to block Microsoft’s $75bn acquisition of Activision Blizzard, she dealt a sharp setback to the regulator’s ambitious effort to toughen antitrust enforcement under chair Lina Khan. "}],[{"start":32.29,"text":"Judge Jacqueline Scott Corley ruled on Tuesday that the FTC had failed to prove that the megamerger would harm competition in the video game industry. "},{"start":41.382,"text":"The details of her ruling revolved around whether Microsoft would limit its rival Sony’s access to blockbuster Activision game Call of Duty, but the decision’s resonance in Washington and corporate America will be much broader. "}],[{"start":55.75,"text":"Appointed by President Joe Biden, Khan came to prominence as a young academic with a paper calling for the break-up of Amazon. "},{"start":63.879,"text":"She has aroused animosity and fear in corporate America for her willingness to use new legal tactics to crack down on anti-competitive conduct even as her efforts have met with mixed results. "}],[{"start":76.11,"text":"Khan has focused on preventing US tech giants from extending their market dominance into new areas. "},{"start":82.652,"text":"She has also stepped up efforts to challenge tie-ups known as “vertical mergers” because they combine companies that have a supplier-customer relationship. "},{"start":91.444,"text":"These are harder to win than “horizontal mergers” between direct competitors. "}],[{"start":96.99,"text":"While prior agency heads have often sought to avoid court losses, Khan has expressed a willingness to push the envelope to seek change. "},{"start":105.594,"text":"“You lose all the shots you don’t take,” she told CNBC last year. "}],[{"start":111.28,"text":"In April, the FTC ordered Illumina to divest cancer screening company Grail in a vertical merger case that is now being appealed, but the watchdog’s effort to block Meta’s acquisition of virtual reality games business Within was rebuffed by a federal judge in February. "}],[{"start":128.45,"text":"That makes Corley’s ruling a “major setback” to Khan’s efforts “to extend the frontiers of enforcement . . . [and] zero in on acquisitions by dominant tech players to prevent them from using acquisitions to reinforce a position of pre-eminence”, said William Kovacic, who chaired the FTC under Republican president George W Bush. "}],[{"start":148.59,"text":"“If you want a durable change in policy and doctrine, you have to win cases,” he added. "}],[{"start":154.77,"text":"The FTC had sought a preliminary injunction to halt Microsoft’s purchase of Activision pending the outcome of a separate challenge that is scheduled to be heard in its in-house court starting on August 2. "},{"start":167.12400000000002,"text":"Mergers are much harder to unwind after they have been completed. "}],[{"start":172.37,"text":"The watchdog must decide by Friday whether to challenge the Microsoft decision in the Ninth Circuit appeals court. "},{"start":179.312,"text":"When it lost the Meta-Within case at a similar stage, it declined to comment. "},{"start":184.267,"text":"But this time, the FTC took a more combative stance, saying “in the coming days we’ll be announcing our next step to continue our fight to preserve competition and protect consumers”. "}],[{"start":196.26,"text":"Legal observers said one potential line of appeal could be the language Judge Corley used in the California ruling. "},{"start":203.552,"text":"She wrote the FTC had failed to show the deal “will substantially lessen competition,” whereas the Clayton Antitrust Act, on which the ruling is based, uses the softer verb “may”. "}],[{"start":214.87,"text":"“If the judge has been assessing the evidence using the wrong legal standard, then every . . . [question] of law and fact is suspect,” said Robert Lande, professor emeritus at the University of Baltimore School of Law. "}],[{"start":228.87,"text":"However, the Ninth Circuit in 2020 ruled against the FTC in a case against mobile chip technology company Qualcomm. "},{"start":237.424,"text":"That involved claims of an existing monopoly, rather than concerns about a merger, but the decision “is indicative of the scepticism towards intervention that you might encounter if you go out to that court on appeal”, Kovacic said. "}],[{"start":252.45,"text":"While the Microsoft-Activision case “will play an important role in defining chair Khan’s record” it is “early for a final assessment” said Michael Carrier, a Rutgers University law professor. "}],[{"start":264.77,"text":"Khan’s FTC has amassed a mixed record when it comes to Big Tech. "},{"start":269.762,"text":"It declined to challenge Amazon’s $3.9bn acquisition of healthcare chain One Medical. "},{"start":276.642,"text":"But the agency has filed three consumer protection lawsuits against the online retailer and is probing Amazon’s agreement to acquire iRobot, maker of the Roomba robot vacuum cleaner. "}],[{"start":289.52,"text":"Although the FTC failed to block Meta’s purchase of Within, it claimed a big victory against the Facebook owner last year when a US judge refused to dismiss a lawsuit seeking to unwind its acquisitions of Instagram and WhatsApp. "},{"start":303.98699999999997,"text":"That case continues. "}],[{"start":306.78,"text":"Dealmakers have repeatedly accused Khan of having a chilling impact on US mergers and acquisitions, which her supporters see as a success, but some legal experts warn that a string of unsuccessful cases may provide companies with the tools to defeat antitrust regulators in the future. "}],[{"start":325.21999999999997,"text":"The FTC will face “skilful opposition from parties who are seeing in these cases how they can prevail”, Kovacic said. "},{"start":333.01199999999994,"text":"“And whether that is good for the agency in the long term is a very important question. ”"}],[{"start":338.97999999999996,"text":"A potential loss in the Microsoft case is unlikely to curb Khan’s tough antitrust policy, lawyers said. "},{"start":346.234,"text":"“Their other losses haven’t had that effect so far,” said Charles Rule, a partner at Rule Garza Howley. "}],[{"start":352.79999999999995,"text":""}]],"url":"https://creatives.ftacademy.cn/album/001100231-1689216099.mp3"}

您已阅读100%（6333字），剩余0%（0字）包含更多重要信息，订阅以继续探索完整内容，并享受更多专属服务。

Microsoft-Activision ruling represents setback for FTC chair Lina Khan

FT商学院

您可能感兴趣的文章