California Agency Drops Sexual Harassment Case Against Activision Blizzard
More than two years after a California state agency accused video game maker Activision Blizzard of promoting a culture of sexual harassment against women, the agency withdrew its accusations on Friday in a stunning reversal.
The California Civil Rights Department and Activision Blizzard said in a settlement agreement with the company that “no court or independent investigation has substantiated any allegations” of “systemic or widespread sexual harassment at Activision Blizzard,” nor “that senior executives of Activision Blizzard ignored , condoned or tolerated a culture of systemic harassment, retaliation, or discrimination.” The settlement agreement also states that the investigation found no evidence of wrongdoing by Activision’s board or its CEO, Robert Kotick.
The dropping of the charges ends a long-running saga about the company, which it had repeatedly said was false. The California agency’s original complaint alleged that the state conducted an investigation into Activision and found that it “promoted a pervasive ‘frat boy’ workplace” and that female employees were “subject to ongoing sexual harassment.” At the time the suit was filed, Activision said the complaint contained “distorted and in many cases false descriptions” and was “irresponsible conduct by irresponsible state bureaucrats.”
The settlement agreement is expected to be filed with the court early next week.
According to the settlement, signed by both parties, Gilbert Casellas, former chairman of the Equal Employment Opportunity Commission, conducted an investigation into Activision Blizzard and determined that there was “no widespread harassment or recurring pattern or practice of gender harassment” at the company .
Activision Blizzard, which makes video games like Call of Duty, Guitar Hero and World of Warcraft, was recently acquired by Microsoft after a long battle with antitrust regulators. The Federal Trade Commission had tried to block the deal, but a judge ruled in its favor.
The California Civil Rights Department case – and the confusion it caused about the company in 2021 – was one of the factors that led Microsoft to buy Activision as its shares had fallen.
As part of the settlement, Activision Blizzard agreed to set aside money — as much as $46.75 million — to pay women who worked at the company from 2015 to 2020 and who said they received inequitable pay. But, unusually, one of the California agency’s own expert witnesses testified that when he took into account the seniority of women’s positions at the company, he found no pay disparities. He said there was a discrepancy when the rank of employees was not taken into account.
Activision agreed to hire an outside consultant to evaluate compensation, promotional policies and training as part of the settlement.