Microsoft was hit by a private consumer lawsuit in a U.S. court on Tuesday, alleging that the tech company’s $69 billion (approx.
The lawsuit, filed in federal court in California, comes about two weeks after the US Federal Trade Commission (FTC) filed a case with an administrative law judge to challenge Microsoft, the owner of the Xbox console, from completing the largest acquisition to date in the video game market.
The private suit also seeks an order preventing Microsoft from acquiring it activity. It was submitted on behalf of 10 video game players in California, New Mexico and New Jersey.
The proposed acquisition would give Microsoft “far outsized market power in the video game industry,” according to the complaint, “with the ability to foreclose competitors, limit production, limit consumer choice, raise prices and further inhibit competition.” .
A representative for Microsoft did not comment immediately on Tuesday. After the FTC sued, Microsoft President Brad Smith said, “We have full confidence in our case and welcome the opportunity to bring our case to court.”
In a statement, plaintiffs’ attorney Joseph Saveri said in San Francisco, “As the video game industry continues to grow and evolve, it is critical that we protect the market from monopolistic mergers that will harm consumers in the long term.”
Private prosecutors can bring antitrust claims in US courts even while a related case is pending before a US agency. The takeover announced in January is also being examined by antitrust law in the European Union.
The FTC previously said it sued to “prevent Microsoft from gaining control of a leading independent game studio.” The agency said the merger would hurt competition between rival gaming platforms Nintendo and Sony group.
© Thomson Reuters 2022
