Activision Blizzard agrees to pay $18 million to settle EEOC probe

Videogame-publishing giant faces other battles, including SEC investigation and California lawsuit

Activision Blizzard Inc. on Monday said it had agreed to pay $18 million as part of a settlement with the Equal Employment Opportunity Commission, which had been examining allegations of gender-based harassment and retaliation at the embattled videogame-publishing giant.

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Santa Monica, Calif.-based Activision, with about 10,000 employees across the world, agreed to an outside monitor approved by the EEOC to make sure Activision is complying with its settlement agreement, according to a company press release. The findings by the outside consultant will be reported regularly to the EEOC and Activision’s board of directors, the company said.

The EEOC since 2018 had been looking into the allegations, according to a complaint the agency filed against Activision in U.S. District Court shortly before the settlement.

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The EEOC, in the complaint, said Activision employees were subjected to "sexual harassment that was severe or pervasive to alter the conditions of employment." Activision "failed to take corrective and preventative measures," according to the complaint.

Activision, known for its "Call of Duty," "World of Warcraft" and "Candy Crush" franchises, said the agreement is subject to court approval. A spokesman for the EEOC said the agency wouldn’t comment on ongoing litigation.

Activision Blizzard Inc. on Monday said it had agreed to pay $18 million as part of a settlement with the Equal Employment Opportunity Commission, which had been examining allegations of gender-based harassment and retaliation at the embattled videog (Photo Illustration)

Activision’s longtime chief executive, Bobby Kotick, said in a statement, "We will continue to be vigilant in our commitment to the elimination of harassment and discrimination in the workplace."

The company said it would take other steps to "prevent and eliminate harassment," including providing better training.

Activision faces other legal battles.

The U.S. Securities and Exchange Commission has subpoenaed Activision and several of its senior executives, including Kotick, The Wall Street Journal reported last week. The subpoena is part of an investigation into how the company handled employees’ allegations of sexual misconduct and workplace discrimination, according to people familiar with the investigation and documents viewed by the Journal.

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The SEC is asking for Kotick’s communications with senior executives regarding complaints of sexual harassment or discrimination by Activision employees or contractors, among other items, the documents show. An SEC spokeswoman has declined to comment.

Activision, the largest U.S. videogame publisher by market capitalization, also is being sued by the California Department of Fair Employment and Housing. The department, among other allegations, said in July that the company paid women less than their male counterparts, provided women with fewer opportunities to advance, and maintained a "frat boy" culture, primarily at its Blizzard Entertainment unit.

Activision has said it would fight the charges from the California agency. It initially slammed the lawsuit, saying it included distorted, and in many cases false, descriptions of its past. Employees responded by planning walkouts, and Kotick said Activision’s initial response was tone deaf and that the company had hired a law firm to investigate the complaints.

An Activision spokeswoman said in a statement last week that Activision is deeply committed to making the company one of the best, most inclusive places to work.

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"We have made and are making a number of important changes to improve our policies and procedures to ensure that there is no place anywhere in our company for discrimination, harassment or unequal treatment of any kind," the statement said.

The company also is facing lawsuits from some of its investors, and earlier this month, the Communications Workers of America filed with the National Labor Relations Board against Activision, alleging worker intimidation. The charges include allegations company management used coercive tactics to prevent its employees from exercising their rights to organize under federal law.

The company, the spokeswoman said last week, has "made great efforts to respect the rights of all employees under the NLRB."

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Activision said this month it hired two senior executives to help it build a more inclusive workplace and grow its revenue. Julie Hodges, a Walt Disney Co. executive, was named chief people officer and Sandeep Dube, a Delta Air Lines Inc. executive, was named chief commercial officer. Hodges, who had oversight of compensation, benefits and talent acquisition at Disney, is filling the role of human resources chief being vacated by Claudine Naughton.