Microsoft, Activision Ordered to Face Lawsuit Over Merger (1)

Microsoft Corp. and Activision Blizzard Inc., the video game studio it bought last year for $69 billion, lost their bid Thursday to end a pension fund’s lawsuit challenging the transaction.

A Delaware judge let the shareholder case move forward, saying it’s “reasonably conceivable” Activision’s board violated corporate laws by approving only a rough version of the merger agreement that left open key terms, including how much it could pay out in dividends during the deal’s lengthy regulatory review.

The Swedish state-owned pension fund leading the case “has adequately alleged that the merger was invalid,” Chancellor Kathaleen St. J. McCormick ...