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Report: Allegations of insider trading linked with Microsoft-Activision deal

The SEC and Department of Justice are reportedly looking into the allegations, which concern an option trade worth millions.

Chris Kerr, News Editor

March 9, 2022

1 Min Read

The Securities and Exchange Commission (SEC) and the Department of Justice are reportedly investigating allegations of insider trading in connection with Microsoft's $68.7 billion purchase of Activision Blizzard.

As reported by The Wall Street Journal (via Forbes), it's claimed that tycoons Barry Diller, David Geffen, and Alexander von Furstenberg each broke insider trading laws by purchasing Activision Blizzard call options shortly before the company was purchased by Microsoft.

It's reported that all three bought call options to buy Activision Blizzard shares at $40 on January 14, 2022, which was just four days before Microsoft agreed to purchase the Call of Duty publisher at $95 per share.

As a result of the move, Diller, Geffen, and von Furstenberg reportedly generated unrealized profits of roughly $60 million. In a statement handed to Forbes, Diller refuted the allegations and said neither he, nor Geffen and von Furstenberg, had any knowledge of the impending Microsoft deal when they purchased their call options.

"None of us had any knowledge from any person or any source or any anything about a potential acquisition of Activision by Microsoft," said Diller, in a statement sent through his media company, IAC.

"We acted simply on the belief that Activision was undervalued and therefore had the potential for going private or being acquired. And, if we had any such information we would never have traded on it -- it strains credulity to believe we would have done so three days before Microsoft and Activision made their announcement."

According to the Wall Street Journal, all three were reported to law enforcement by JPMorgan Chase, the investment bank which helped facilitate their respective transactions.

About the Author(s)

Chris Kerr

News Editor, GameDeveloper.com

Game Developer news editor Chris Kerr is an award-winning journalist and reporter with over a decade of experience in the game industry. His byline has appeared in notable print and digital publications including Edge, Stuff, Wireframe, International Business Times, and PocketGamer.biz. Throughout his career, Chris has covered major industry events including GDC, PAX Australia, Gamescom, Paris Games Week, and Develop Brighton. He has featured on the judging panel at The Develop Star Awards on multiple occasions and appeared on BBC Radio 5 Live to discuss breaking news.

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