The Federal Trade Commission (FTC) has suffered a significant setback in its legal battle against Microsoft's $68.7 billion acquisition of Activision Blizzard. In 2023, the FTC sought a preliminary injunction to block the companies from completing the deal while it continued to challenge the acquisition, which was originally announced in 2022. The FTC argued that if Microsoft gained control of Activision's content, it could potentially harm competition by withholding or degrading that content, affecting product quality, price, and innovation. However, today, an appeals court panel upheld the lower court's decision to deny the FTC's request for an injunction, as reported by Reuters. The panel's opinion stated that the FTC failed to provide sufficient evidence to show a likelihood of success on the merits of its case. This means that the district court correctly denied the FTC's motion for a preliminary injunction based on the available evidence. Despite this ruling, the acquisition remains under review in an ongoing administrative proceeding before the FTC. Spokespeople from both the FTC and Microsoft declined to comment on the court's decision. This development highlights the complex and often lengthy process involved in major corporate acquisitions, especially those in the technology and gaming sectors, where regulatory scrutiny is intense. The next phase of the legal challenge will now focus on the administrative proceeding, which could still influence the future of the deal. For now, Microsoft and Activision Blizzard can proceed with their integration plans, confident that they have overcome a crucial legal hurdle.