Thread by @MActon93

#Microsoft #Activision - refresher thread for those who may not be familiar with the legal jargon here.

To win a preliminary injunction blocking a deal, FTC does *not* have to show it's anticompetitive.

Instead, the judge assessing the case has to do three things:

1 - Decide if the market definition makes sense

2 - Determine whether there's a "likelihood of success on the merits"

3 - Balance the equities

So what does that all mean?

First, market definition. A lot of antitrust cases sink at this point, and it gets very complicated.

Judge will look at FTC's case and decide whether high-performance consoles (PS5/Xbox) are a market. Don't they compete with PC, for example?

In the Meta-Within case earlier this year, the FTC won on market definition (VR fitness apps).

Lost on evidence (that case was a bit more complicated because the FTC was also pushing a rarely-used legal theory).

Second - likelihood of success on the merits.

Judge assesses the evidence and decides if the case for anticompetitive harms makes sense.

Here it's about MS withholding Activision games from competitors, among other things.

Importantly, this is NOT the same as saying "the FTC proved its case," or "the FTC will win its case."

FTC just needs to raise questions serious enough to warrant thorough investigation. It's all a bit nebulous and really comes down to the judge's assessment of the evidence.

That's why I have been reminding people that this is not the same assessment the judge made in the video gamers case.

In that case the judge didn't even get to these questions. She just found there wasn't a case for imminent harm to gamers, which was enough to deny the motion.

Third - balancing the equities.

That's a fancy term for the judge considering Microsoft and Activision's situation.

What harm will they suffer if the deal is blocked, versus the benefits from blocking it?

FTC kind of has to run the table on these three things in order to win.

Microsoft and Activision have multiple lines of defense here.

PI requests are always difficult cases, because they involve asking a court to make a pretty drastic intervention.

A note to end - in the last few days I've been @ a lot by people with strong views on the deal.

While I welcome the level of interest, I want to remind people that my focus is on providing fast and accurate reporting. Not pushing a narrative. And I'll keep doing that.