The show must go on —

But Judge Corley says plaintiffs now have a “plausible” case for potential harm.


A group of PlayStation owners worries that an image like this is coming in their near future...

Enlarge / A group of PlayStation owners worries that an image like this is coming in their near future…

A federal judge has refused to grant a requested preliminary injunction that would have stopped Microsoft’s continuing effort to buy Activision Blizzard. But as the private case moves forward, the judge in the case writes that the plaintiffs have “plausibly” argued that they might be adversely affected by the deal’s anti-competitive effects.

The so-called “gamers’ lawsuit” against the Microsoft/Activision deal was initially filed by a group of 10 PlayStation Call of Duty players in December, alleging that the deal could lead to increased prices and/or decreased quality or availability for the franchise on their console of choice. While the case was dismissed in March, the plaintiffs offered an amended complaint last month, laying out more precisely the harm they believe they could suffer after a merger.

Regarding those amended claims, District Court Judge Jacqueline Scott Corley said in a Friday ruling that, while it was too early to fully rule on the merits of the case, the plaintiffs “plausibly attest to their loyalty to the Call of Duty franchise and thus that each will purchase a different console or subscription service, or pay an inflated price, if needed to continue to play Call of Duty, especially if needed to play with their friends.” That’s a turnaround from the initial March dismissal, where Corley wrote that the plaintiffs didn’t “plausibly allege” that the merger “creates a reasonable probability of anticompetitive effects in any relevant market.”

Even if those “plausible” claims are eventually proved at trial, though, Corley said the plaintiffs hadn’t shown any evidence of the “immediate, irreparable harm” that would be needed to justify a preliminary injunction at this point. On the contrary, Corley writes that, immediately following any merger, there’s no evidence that Microsoft “can do anything to make these [existing PlayStation] Call of Duty versions currently owned by Plaintiffs somehow stop working, let alone that it would do so.”

And even if Microsoft eventually announces it is barring future Call of Duty versions from PlayStation (something it has pledged not to do multiple times), Corley notes that “a preliminary injunction could be entered at that time.” As it stands, though, any potential “harm” that would be caused to PlayStation owners by the merger “will not occur between now and a trial on the merits,” Corley writes.

Any effects of the merger will also have to wait until the resolution of the current Federal Trade Commission administrative action seeking to stop the deal, not to mention UK regulatory efforts to do the same. If and when the deal finally survives those hurdles, Corley writes that “the Court will be able to hold a trial on the merits and finally decide the issue before Plaintiffs suffer any irreparable harm.”

Speaking to Reuters, attorney Joseph Alioto said the “evidence is very strong” for an eventual antitrust decision in the case.

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