Activision Blizzard Settles Lawsuit with California, Agrees to Pay $54 Million

Activision Blizzard has reached a settlement in its 2021 lawsuit with the state of California, agreeing to pay $54 million to the state and an additional $47 million to female employees who were with the company from 2015 to 2020.

The lawsuit, initially filed by the California Department of Fair Employment and Housing (now known as the California Civil Rights Department), accused Activision Blizzard of promoting a workplace culture filled with sexual harassment. However, the settlement agreement states that investigations did not uncover evidence of "systemic or widespread sexual harassment."

A settlement agreement revealed that an investigation into Activision's board, including CEO Bobby Kotick, found no evidence of misconduct. However, a 2021 report by The Wall Street Journal alleged that Kotick had concealed knowledge of wrongdoing within the company, including making a death threat to a female assistant in 2006 and intervening in an internal sexual harassment investigation. Despite Activision Blizzard's initial dismissal of the allegations, the company announced measures to create a more accountable workplace, such as expanding and restructuring its Employee Relations and Ethics & Compliance teams. Additionally, over 20 individuals involved in "resolved reports" had left the company, and approximately 20 others were facing disciplinary action.

Activision Blizzard's games were impacted by the lawsuit, with Blizzard taking steps to distance itself from involved employees. In World of Warcraft, references to the only Blizzard employee named in California's lawsuit were removed. Additionally, the name of the Overwatch character Jesse McCree, named after a former Blizzard employee who was fired following the lawsuit, was changed.

The lawsuit contributed to Microsoft's acquisition of Activision Blizzard, a deal that was completed this year. The stock price of the publisher behind Call of Duty and World of Warcraft fell significantly after the lawsuit's accusations, ultimately leading to Microsoft's $69 billion acquisition.

The lawsuit in California resulted in employee walkouts at Activision Blizzard, the departure of then-president J. Allen Brack, and efforts to unionize various studios under the Activision Blizzard umbrella. After the lawsuit, quality assurance testers at Raven Software and Blizzard Albany (formerly Vicarious Visions) unionized, and Proletariat, another studio acquired by Activision Blizzard, sought to do the same. However, their union vote was dropped due to accusations that Proletariat's CEO, Seth Sivak, had interfered. Activision Blizzard has also settled other cases, including an $18 million settlement with the Federal Equal Employment Opportunity Commission for a separate sexual harassment lawsuit and a $35 million settlement with the SEC (U.S. Securities and Exchange Commission) over accusations of improper information disclosure.

According to The New York Times, the 2021 state of California settlement agreement is still subject to court approval and will be filed later this week.

Editor's P/S

As a Gen Z netizen, I am deeply concerned about the allegations of sexual harassment and misconduct at Activision Blizzard. The fact that the company has agreed to pay a significant settlement amount to resolve the lawsuit is a clear indication that there were serious issues within the workplace culture. It is unacceptable that employees had to endure such a hostile environment, and I hope that the settlement will bring some measure of justice to those affected.

I am also disappointed by the lack of accountability at the highest levels of Activision Blizzard. The fact that CEO Bobby Kotick was not found to have engaged in misconduct, despite the serious allegations against him, is deeply troubling. It is essential that those in positions of power are held accountable for their actions, and I hope that further investigations will shed light on any potential wrongdoing.