Activision Blizzard, the video game giant behind popular titles such as Call of Duty, World of Warcraft, and Overwatch, has agreed to pay over $54 million to settle a sex discrimination lawsuit that dates back to 2021. The company, now a subsidiary of Microsoft, will also create a compensation fund for affected employees and update its policies and practices.
The lawsuit was filed by the State’s Department of Fair Employment and Housing (DFEH) in June 2021, alleging that Activision Blizzard subjected female employees to sexual harassment, pregnancy discrimination, and related retaliation. The lawsuit also claimed that the company fostered a “frat boy” culture that was hostile to women. The allegations sparked a wave of protests and backlash from employees, customers, and investors, as well as scrutiny from regulators and lawmakers.
After the disclosures, Activision Blizzard’s stock price dropped, leading to discussions about Microsoft acquiring the company. The company also faced several leadership changes, including the departure of Blizzard president J. Allen Brack. The $69 billion deal was approved in October after being thoroughly examined by U.S. and European regulatory bodies.
The settlement resolves the dispute between Activision Blizzard and the California Civil Rights Department, as well as a separate class action lawsuit filed by current and former employees. The company agreed to pay around $55 million to provide assistance to female employees and contractors from October 2015 to December 2020 and cover legal fees. About $46 million of the total will go to the fund for affected women.
Activision Blizzard stated, “We are gratified that we have reached an agreement with the California Civil Rights Department (CRD) today, as the CRD has now announced in a press statement. We appreciate the importance of the issues addressed in this agreement and we are dedicated to fully implementing all the new obligations we have assumed as part of it. We want our employees to know that, as the agreement specifies, we are committed to ensuring fair compensation and promotion policies and practices for all our employees, and we will continue our efforts regarding inclusion of qualified candidates from underrepresented communities in outreach, recruitment, and retention.”
The CRD has agreed to file an amended complaint that withdraws its 2021 claims of widespread workplace harassment at Activision Blizzard. The agreement explicitly states that no court or independent investigation has substantiated allegations of systemic sexual harassment at the company. Additionally, the CRD acknowledges that there is no evidence of improper handling of workplace misconduct by Activision Blizzard’s Board of Directors, including CEO Robert Kotick.
The steps taken by Activision Blizzard in the wake of this lawsuit could potentially serve as a model for other companies facing similar challenges. The industry will undoubtedly be watching closely to see how these changes are implemented and what impact they have on the company’s culture moving forward.
Relevant articles:
– Activision Blizzard agrees to settle California case alleging discrimination against women
– Activision Blizzard settles sex discrimination lawsuit for £44m
– Microsoft’s Activision Blizzard Settles California Gender Discrimination Case For $55M
– Activision Blizzard Settles California Harassment Suit for $54 Million