FTC drops deal to block Meta’s acquisition of VR startup Within Unlimited

The Federal Trade Commission (FTC) on Friday dropped a last-ditch effort to block Meta Platforms Inc.’s (META) acquisition of a virtual reality startup, handing the ultimate victory to the Facebook parent.

A federal judge rejected the FTC’s request for a court order to halt Meta’s acquisition of Within Unlimited less than a month before the FTC announced it was dropping administrative proceedings over the deal. The ruling by U.S. District Judge Edward Davila did not directly affect the FTC’s challenge in its internal administrative court, and it was unclear at the time whether the FTC would proceed with the administrative case.

U.S. antitrust enforcers typically drop such administrative actions after a federal judge dismisses an injunction request.

Both the administrative case and the lawsuit in federal court have been closely watched as the FTC has adopted an unusual theory of competitive harm that focuses on potential future competition in nascent industries. The case is also widely believed to be the case of FTC Chairman Lina…