FTC sues over Microsoft’s intentions to lay off 1900 game developers

The U.S. Federal Trade Commission (FTC) has appealed to the Court of Appeals over Microsoft’s intention to lay off 1,900 employees involved in game development, writes Bloomberg.

The company’s plans are the result of a $68.7 billion deal with Activision Blizzard. According to the FTC, the cuts contradict Microsoft’s statements that Blizzard will retain its independence after the acquisition of Activision.

As you know, the FTC was against the deal between the two companies. The Trade Commission sought an injunction against the merger from a US federal district court. But last summer, a California judge allowed Microsoft to close the deal to buy Activision Blizzard. At the time, the judge noted that the FTC had not proved that the merger would significantly lessen competition in the industry.

Eventually, Microsoft officially announced a merger with Activision Blizzard last October. In January of this year, it became known that Microsoft is going to lay off 1,900 of its 22,000 game development employees.

These layoffs are a direct consequence of the Microsoft-Activision Blizzard deal, which resulted in the merged company having “redundant” employees performing similar functions. Given the situation, the FTC is stepping up its efforts to combat mergers.