FTC Hauls Take-Two Into Court Over EA Takeover Bid (UPDATED with GP Exclusive Content)

June 11, 2008 -

Reuters is reporting that the Federal Trade Commission has initiated proceedings in U.S. District Court to compel Take-Two Interactive to respond to the FTC's subpoenas in relation to Electronic Arts' ongoing hostile takeover bid.

As GamePolitics reported last week, Electronic Arts placed its takeover on hold pending the FTC's review to determine whether an EA-T2 merger would violate federal antitrust laws.

GP is currently reviewing court documents. An affidavit by FTC attortney Reid Horwitz alleges that Take-Two reneged on agreements to provide documents requested by the FTC.

Horwitz also writes that the federal agency is particularly interested in the files of Take-Two CEO Ben Feder and Visual Concepts president Greg Thomas, along with several sales and marketing execs, one of whom was formerly the marketing VP for 2K Sports.

Given the government interest in 2K Sports and Thomas, whose studio creates most of T2's sports titles, it's clear that the FTC investigation is centered around a possible monopoly in sports games should the EA takeover occur.

While it may appear odd that T2 would balk at the FTC request, according to FTC attorney Horwitz, T2's position seems to be that it should not be burdened with providing the documents since it was EA that inititated the uninvited takeover attempt. T2 claimed to the FTC that it spent in excess of one million dollars in providing a limited amount of info to the agency.

Horwitz relates that, while T2 agreed to give up some of the requested employee files, it refused to provide files from CEO Ben Feder or Visual Concepts' Greg Thomas. When the FTC asked why, a Take-Two attorney replied:

These individuals were "creative types" who would leave the company rather than allow their files to be searched...

UPDATE: U.S. District Court Judge Henry Kennedy has apparently been persuaded by the government's position, and has ordered Take-Two into court on June 24th to show cause why he shouldn't rule in favor of the FTC.

UPDATE 2: A document filed by Take-Two with the Securities and Exchange Commission provides its comment on the FTC issue:

Prior to the issuance of the FTC’s subpoena and CID the Company has been cooperating fully with the FTC with regard to their review of EA’s Offer to acquire the Company. The Company has already provided enormous quantities of data and access to key executives, and has offered to provide the FTC staff with additional documents and information. Nevertheless, the Company believes the FTC’s subpoena
and CID are unnecessarily broad and would entail unacceptable additional expense to the Company. To limit the inordinate expense and labor that the FTC’s demand would entail, the Company has sought to obtain reasonable limits on the scope of the information sought. The Company will continue to cooperate actively and produce documents in response to the FTC’s previous requests, and will of course attempt to seek an acceptable resolution to this matter as quickly as possible.

 


Comments

Re: FTC Hauls Take-Two Into Court Over EA Takeover Bid (UPDATED

 

I'm all for freedom of ttnet vitamin speech and allowing rent a car game makers to put whatever they want in games, but there's one thing about this app that has me scratching my head.  Correct me if I'm wrong, but from araç kiralama the previous article araba kiralama on this I gathered that players can use Google maps in-game to find the other (real-life?) dealers in their area.  If this is the case, has travesti anyone considered what's stopping someone from using this app to actually move drugs between hands for reals?

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The entire arguement is kiralık oto based upon a social normality inflicted by luddites who can't figure out the controls for Halo so it's frightening and terrifying and obviously the cause of youth violence on the rise even though, in reality, it's in decline (which is actually a HUGE suprise given minibüs kiralama the economies status).  In  a perfect world, we would have parents that actually parent.  The idea of sales restrictions on media on oto kiralama any form to accomidate parental unwillingness to get involved with their child's life is the real problem to me.  Here I am, 32 years old, and being held up at a self-scan rent a car needing to show ID before I can buy a $10 M rated game all because Soccer Momthra can't be bothered to look at the crap Billy Genericallystupidson does in his free time.  It's too hard for her, so I have to suffer?

Re: FTC Hauls Take-Two Into Court Over EA Takeover Bid (UPDATED

didn't see the comment above, Gray 17.

Re: FTC Hauls Take-Two Into Court Over EA Takeover Bid (UPDATED

It's very disappointing to see EA come down at such a low level. In my opinion, EA is a very greedy corporation. First the Madden franchise, now this.

Re: FTC Hauls Take-Two Into Court Over EA Takeover Bid (UPDATED

While I appreciate the sentiment, I don't think they've got too much of a leg to stand on. The NFL is the one that approached EA with an offer of exclusivity. Essentially the holder of the NFL copyright decided to pick one publisher and stick with them.

 

It's unpleasant for consumers, but within the NFL's rights. It's probably comparable to a developer deciding to be exclusive to one platform. Suck for fans of other platforms that would like to play that developers games, but it's within the developers rights.

Re: FTC Hauls Take-Two Into Court Over EA Takeover Bid (UPDATED

Oops, this was supposed to be about the class action story above.

Re: FTC Hauls Take-Two Into Court Over EA Takeover Bid (UPDATED

^--- :O~~~

I don't see how the FTC would rule in favor of EA having a monopoly on sporting games in general.  They basically sell the only profitable sports game here in north america, and any other sport that is made/sold is generally to a niche market which really doesn't affect EA's monopoly on sporting games! 

They have it all, football, hockey, golf, boxing.. (cricket!).  Basically all the sporting games that people will buy year after year.  I haven't seen any baseball, but maybe thats because EA is losing out to baseball mogul in that department!

In anycase, yea.. don't see how the FTC could possibly give EA the go-ahead.

Re: FTC Hauls Take-Two Into Court Over EA Takeover Bid (UPDATED

Since my post was eaten, I'll repost

I personally see a couple reasons.

1. Take Two feels all that needs to be said has been saidm and that the FTC look no further than them havign 2k sports and EA wanting them.

2. They don't want a certain soemoen fighting tooth and nail ot get his hands on those files thinking heh as a "right" to them

Second one seems out there, i know, just my paranoia showing.

-kurisu7885

Re: FTC Hauls Take-Two Into Court Over EA Takeover Bid (UPDATED

That's odd. I don't see any other posts from you.

E. Zachary Knight
www.editorialgames.com

 

Re: FTC Hauls Take-Two Into Court Over EA Takeover Bid (UPDATED

 Igot a server timeout notice, so that may have been it.

Re: FTC Hauls Take-Two Into Court Over EA Takeover Bid (UPDATED

Voting for that there must be something in the requested files that T2 would rather not see the light of day. Question is what!

Re: FTC Hauls Take-Two Into Court Over EA Takeover Bid (UPDATED

the full nude version of hot coffee!

Re: FTC Hauls Take-Two Into Court Over EA Takeover Bid (UPDATED

Nice angle on that "we didn't start the thing so why should we be bothered to provide documentation?" Imagine this applied to criminal cases: "I wasn't the one who pressed charges so why would I have to go to trial?"

Also, I'm not sure what documents the FCT is requesting from the CEO but I really doubt they can simply refuse to provide them, especially on the grounds of personal nuisance. It is a publicly held company after all.

Re: FTC Hauls Take-Two Into Court Over EA Takeover Bid (UPDATED

Nice angle on that "we didn't start the thing so why should we be bothered to provide documentation?" Imagine this applied to criminal cases: "I wasn't the one who pressed charges so why would I have to go to trial?"

You got the comparison wrong, it should be "I was the one that was assaulted, so why should I be put on trial for being victimized?"

Re: FTC Hauls Take-Two Into Court Over EA Takeover Bid

Hasn't Take-Two already said no? Or have they just been sitting on the offer? If the latter, then I assume they can clear this up by telling EA where to shove their offer.


 

Re: FTC Hauls Take-Two Into Court Over EA Takeover Bid

Take Two did decline EA's offer twice. This has become a hostile takeover. EA is trying to buy a majority of Take Two's stock directly from the share holders. 

Re: FTC Hauls Take-Two Into Court Over EA Takeover Bid

which is why, should you ever be owner of a company you decide to take public, you never ever sell more than 48% or so of the stock to the general public. you cross that 50% +1 shares floating out in the world and you open yourself up to this sort of attack.

Re: FTC Hauls Take-Two Into Court Over EA Takeover Bid

Which is why if you own a company, you should never take it public. It doesn't matter how many shares you hold or sell. It will all come down and negatively effect you.

There are benefits to going public with your company, but there are also very serious drawbacks as well. So you really need to study hard about what you are doing.

E. Zachary Knight
www.editorialgames.com

 

Re: FTC Hauls Take-Two Into Court Over EA Takeover Bid

Google learned this lesson fast and made sure they owned the majority of their sales.
----
Papa Midnight
http://www.otakutimes.com
http://www.thesupersoldiers.com

 

----
Papa Midnight

Re: FTC Hauls Take-Two Into Court Over EA Takeover Bid

I hope the takeover is found to be illegal. I don't think this consolidation of industry assets to be in the best interest of consumers. 

 
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ConsterSleaker: if you think there's only been "a handful of" incidents, you have your head stuck *somewhere* - I'm assuming it's sand.09/20/2014 - 5:38am
prh99Most of it's agitprop clickbait anyway.09/20/2014 - 5:27am
prh99A good reason to stop reading reguardless of view pointhttp://www.theguardian.com/media/2013/apr/12/news-is-bad-rolf-dobelli.09/20/2014 - 5:22am
Andrew EisenWell this is unique! A musical critique of the Factual Feminist's "Are Video Games Sexist?" video. https://www.youtube.com/watch?v=-K4s7cV4Us409/20/2014 - 2:41am
Andrew EisenSome locked threads. Some let them be. So, no, I'm not seeing a problem here. No corruption. No collusion. No ethical problem with privately discussing ethics.09/20/2014 - 12:48am
Andrew EisenAnd still, in the end, Tito made up his own mind on how to handle his site. All 150 or so members went off to handle their own sites in their own ways. Some talked about it. Some didn't. Some changed disclosure policies. Some didn't.09/20/2014 - 12:40am
Andrew EisenThere were two comments other than Kochera and Tito's. One pointed out the Escapist Code of Conduct, another comment was in support of Tito.09/20/2014 - 12:40am
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Kronotechnical reasons. Anyways, I need to get to sleep as well.09/20/2014 - 12:29am
KronoAnd he wasn't the only one pushing Tito to censor the thread. If Tito had bowed to peer pressure, we likely wouldn't have gotten this http://goo.gl/vKiYtR which grew out of that thread. Said thread also lasted until a new one needed to be made for09/20/2014 - 12:28am
Krono@Andrew So it's an example of Kuchera crossing the line from reporter to advocate. And an example of the group pressuring for censorship.09/20/2014 - 12:21am
E. Zachary KnightAnyway, I am off to bed. I will probably wake up to all of this being knocked off the shout box.09/20/2014 - 12:20am
E. Zachary KnightKrono, that is the type of reading too much into things that bugs me. Ben did no such thing. Greg had the last word in that part of the exchange. The rest was about how to approach the story and Quinn.09/20/2014 - 12:19am
Andrew EisenSo?09/20/2014 - 12:13am
KronoExcept that the forum thread wasn't harassment, and Kuchera continued to push for the thread's removal after Tito made it clear he didn't consider it harassment.09/20/2014 - 12:12am
Andrew EisenPersonally, I see nothing wrong with someone offering their opinion or the other person making up their own mind on how to run their site.09/20/2014 - 12:06am
E. Zachary KnightKrono, I read nothing of the sort in that email chain. I read Ben giving advice on what to do when a forum thread is used to harass someone and spread falshoods about them and others.09/20/2014 - 12:05am
KronoThat's exactly what Ben Kuchera was doing to Greg Tito.09/19/2014 - 11:58pm
Krono@EZK So you see nothing wrong with one journalist pressuring a journalist from a different organization to not only not run a story, but to censor a civil discussion already taking place?09/19/2014 - 11:56pm
E. Zachary KnightI write for a number of blogs and talk to people who write similar blogs all the time for tips and advice. I see nothing wrong with that.09/19/2014 - 11:50pm
 

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