While Activision Blizzard is already facing a lawsuit over sexual discrimination and harassment in the workplace from the California Department of Fair Employment and Housing, it is now facing a second lawsuit, this time from its own shareholders. The suit (which we read on Ars Technica) alleges that thanks to the entire situation, shareholders say they have been “economically damaged”.
Activision Blizzard’s shareholders strike
The lawsuit singles out CEO Robert K. Kotick, current CFO Dennis Durkin, and ex-CFO Spencer Neumann, laying several claims as to why they should be held responsible for the shareholders’, such as being “directly involved in the day-to-day operations of the Company at the highest levels”, “directly or indirectly involved in the oversight or implementation of the Company’s internal control”, and “aware of or recklessly disregarded the fact that the false and misleading statements were being issued concerning the
Blizzard has been under investigation by the California DFEH for two years now, resulting in the aforementioned lawsuit filed two weeks ago. The suit resulted in Blizzard’s share price taking a 6% dive, and it has since dipped a further 5% reports Ars Technica.
Because shareholders were not made aware of the investigation, they believe they have been deceived into overpaying for shares. The logic here is that if Blizzard should have taken into account the impact the DFEH lawsuit might have on its shares and should have made that clear to potential buyers. The suit is seeking monetary damages for the shareholders involved in it.
In other Blizzard related news, the company’s president, J. Allen Brack, and HR head, Jesse Meschuk, have both resigned.