More than two years after the California Civil Rights Department (CRD) filed a high-profile lawsuit against Activision Blizzard accusing the company of widespread gender discrimination and pay inequality, the two parties have reached a settlement for approximately $54 million.
The Wall Street Journal first reported the agreement on Friday, and the CRD published a statement on its website shortly thereafter. As part of the settlement, which requires court approval, Activision Blizzard will “take additional steps to ensure fair pay and promotion practices within the company,” the CRD said.
Additionally, there will be financial relief for women who were employed or contracted by Activision Blizzard between October 12, 2015 and December 31, 2020. If approved, about $45 million of that amount will go directly to a compensation fund to compensate workers, according to the CRD. Any excess funds from the settlement will be distributed to charities that either focus on advancing women in video games and technology or work to promote “awareness of gender equality issues in the workplace.”
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The CRD filed the lawsuit under its previous title, the California Department of Fair Employment and Housing, in 2021 after a two-year investigation into Activision Blizzard. The lawsuit accused Activision Blizzard of multiple violations of California's Equal Pay Act and the Fair Employment and Housing Act, including promoting a “frat boy” culture in which women were often discriminated against.
Activision Blizzard repeatedly denied the allegations and unsuccessfully attempted to dismiss the lawsuit in October 2022. However, it gained so much attention that it appears to have been one of the catalysts for Microsoft's recently completed acquisition of Activision, as the share price had fallen so much.
Meanwhile, controversial CEO Bobby Kotick confirmed that after the takeover he will only remain at the helm of the Call of Duty manufacturer until the end of 2023. A new CEO has not yet been announced.
The WSJ, citing sources familiar with the situation, reports that the regulator had originally sought a much higher amount than the agreement reached with Riot Games in December 2021. According to the WSJ report, the CRD estimated Activision Blizzard's liability in 2021 at nearly $1 billion.
The CRD told IGN that the statement “largely speaks for itself when it comes to the historic nature of this more than $50 million settlement agreement, which will provide direct relief and compensation to women affected by the were harmed by the company’s discriminatory practices.”
Alex Stedman is a senior news editor at IGN and leads entertainment coverage. When she's not writing or editing, she reads fantasy novels or plays Dungeons & Dragons.