Video game maker Activision Blizzard has reportedly agreed to pay about $50 million to settle a civil rights lawsuit in California over employee complaints of sexual harassment, discrimination and pay disparities that contributed to the company’s acquisition by Microsoft.
The settlement is expected to resolve the lawsuit filed by the California Civil Rights Department against the “Call of Duty” video game studio in 2021, the Wall Street Journal reported Friday afternoon, citing people familiar with the matter. The complaint was one of several high-profile investigations by state and federal regulators in recent years into alleged workplace misconduct at Activision and management’s failure to respond appropriately.
While Activision repeatedly denied the allegations, they increased pressure on the Santa Monica, California-based company and its CEO, Bobby Kotick, eventually leading to a $68.7 billion takeover bid by Microsoft MSFT.
+1.31%
in early 2022. The acquisition was completed in October following approval from British and European regulators, although the US Federal Trade Commission continues to challenge the deal in court. Kotick is expected to leave the company, which he led for more than thirty years, at the end of this month.
The settlement would be the second-largest ever for the California Civil Rights Department, following the $100 million agreement with another Los Angeles video game developer, Riot Games, to resolve gender discrimination allegations in 2021, according to the Journal. initially sought a much larger settlement with Activision, the publication reported, citing how the state had estimated the company’s liability at nearly $1 billion to some 2,500 employees with potential claims.
Representatives for Activision and the California Civil Rights Department were not immediately available for comment.
