California Department of Fair Employment and Housing v. Activision Blizzard was a lawsuit filed by the California Civil Rights Department against video game developer Activision Blizzard in July 2021. The lawsuit asserted that management of Activision Blizzard allowed and at times encouraged sexual misconduct towards female employees, that the company maintained a "frat boy" culture, and that the company's hiring and employment practices were discriminatory against women.
After Activision Blizzard dismissed the claims in the lawsuit as false, more than 2,600 of the company's 9,500 staff signed an open letter demanding the company take the allegations seriously and make changes. While Activision CEO Bobby Kotick later promised the company would internally review the allegations, employees were not satisfied by the response. Employees staged a walkout on July 28, 2021, virtually joined by other developers and players across the industry. DFEH's lawsuit triggered a separate class action lawsuit by Activision Blizzard's shareholders at the federal level, asserting that the company failed to meet its fiduciary duties under the Securities Exchange Act of 1934. A later investigative report by The Wall Street Journal published in November 2021 claimed that Kotick had known about the allegations of misconduct for years but failed to take action, leading employees to stage a second walkout, and the broader gaming industry called for Kotick to step down.
Activision Blizzard and the CRD settled the lawsuit in December 2023 for $54 million, mostly associated with pay inequalities, with no admission of widespread harassment within Activision Blizzard. Coupled with allegations of misconduct and discrimination at game developers Riot Games and Ubisoft, the DFEH lawsuit was seen by analysts, academics, and media outlets as bringing the #MeToo movement to the video game industry and raising the likelihood of widespread unionization.
Background
Activision Blizzard
Activision Blizzard was formed in July 2008 as a merger of Activision Inc. and Vivendi Games, a subdivision of the French media conglomerate Vivendi, which owned Blizzard Entertainment. The merger was influenced by the rapid growth of Blizzard's flagship product, the subscription-based massively multiplayer online game (MMO) World of Warcraft. At the time, Activision had yet to create any MMO games. Once the merger was approved, Activision Inc. rebranded as Activision Blizzard. Activision Publishing was established to house Activision's existing studios, and Blizzard Entertainment remained a division within the larger company. Vivendi's share in Activision Blizzard was eventually fully acquired by Activision shareholders in 2014. In February 2016, the company substantially expanded with the acquisition of King, the mobile game developer and publisher behind Candy Crush Saga. King became Activision Blizzard's third major division. From 1991 until his departure in December 2023, Bobby Kotick served as CEO for Activision and Activision Blizzard. Activision Blizzard is the largest North American publisher of video games based on revenue, surpassing Electronic Arts and Take-Two Interactive, and reported over in revenues for their 2020 fiscal year.
Since around 2018, Blizzard Entertainment underwent corporate changes, such as the departure of Blizzard's co-founder Mike Morhaime, and a heavier focus on mobile gaming at the cost of Blizzard's more traditional PC gaming background. PC Gamer considered that some of these changes may be a result of the parent Activision's influence on managing Blizzard towards a more profitable business. Jason Schreier of Bloomberg News reported on Activision's influence on the poor quality of Warcraft 3: Reforged, a remake of Warcraft III, in 2020. Activision did not see much value in remasters at the time of its development in 2017, and instead pressured Blizzard to focus on newer games, according to Schreier. This led to the development budget for Warcraft 3: Reforged to be cut significantly, impacting the game's quality, and the Classic Games team within Blizzard to be disbanded after the game was released.
Discrimination and sexual misconduct in the video game industry
Gender demographics in the video game industry have skewed towards men, particularly in contrast with the demographics of video game players. While companies have worked to improve diversity in hiring, the International Game Developers Association estimated in 2017 that only about 20% of the video game development workforce are women, while the Entertainment Software Association estimated that same year that 41% of gamers were women. As of 2021, Activision Blizzard's workforce is 80% male and following the departure of Jen Oneal the company's top level leadership is exclusively male. The gender gap arises from a feedback loop, in which women are less inclined to join the industry due to lack of apparent representation both within the industry and within video games, as well as typically accepted practices within the industry such as the use of "crunch time" and long working hours that typically disfavor female employees. This situation has led to ongoing concerns about the discrimination and treatment of women within the video game industry. The Gamergate controversy in 2014 raised awareness of mistreatment of women within the industry, alongside the larger #MeToo movement in other sectors.
While the video games industry had experienced other isolated cases of sexual misconduct by one individual towards others, reporters for The Guardian, Time, and The New York Times have observed that the industry had not yet felt the weight of the #MeToo movement that other industries had in 2021. Brianna Wu, one of several women in gaming who faced significant harassment as a result of the Gamergate harassment campaign, said that the video game industry has had visible incidents of sexual misconduct and misogyny towards female developers in which the persons at fault were fired. However, she argued that the impacts of these events had yet to reach the same level of change as the MeToo movement had brought to other media industries, stating that "our industry has done nothing but window-dressing in getting rid of the harassers".
Lawsuit As a result of a two-year investigation, on July 20, 2021, DFEH filed a lawsuit in Los Angeles Superior Court. The lawsuit alleges that Activision Blizzard has fostered a "frat boy" culture in which female employees endure regular sexual harassment and experience discrimination and retaliation. DFEH sought an injunction to require Activision Blizzard to comply with state workforce protections, and to recover damages for female employees that would include unpaid wages, pay adjustments, back pay, and lost wages and benefits.
The lawsuit contends that Activision Blizzard and its workforce, which is 80% male, contribute to a hostile atmosphere towards female employees. The allegations mainly focus on reports of workplace misconduct at Blizzard Entertainment, though also asserts similar problems occurred within Activision and its studios. The complaint describes male employees playing video games during work hours while delegating their job to women employees, engaging in sexual banter and making advances towards female colleagues, and joking about rape. Prominent executives and creators at the company allegedly "engaged in blatant sexual harassment without repercussions". Within both Activision's and Blizzard's studios, management allegedly both allowed and encouraged "cube crawls", where male employees went from cubicle to cubicle, drinking heavily and making inappropriate advances towards and physically touching female employees. An employee's hotel room, rented during the company's annual BlizzCon event in 2013, was reportedly nicknamed the "Cosby suite" by other employees due to the man's reputation for harassing women. This was said to be in reference to the Bill Cosby sexual assault cases, though others claimed the name was chosen based on the room's rug pattern which resembled Cosby's sweaters.
A woman employee reportedly committed suicide during a business trip after suffering "intense sexual harassment" in the preceding days, which included employees sharing nude photos of her at a company holiday party. The human resources departments allegedly did not keep reports of sexual harassment confidential, which as a result allowed managers and others to retaliate against employees who reported misconduct, such as by denying them promotions, transferring them to other departments, prioritizing them during company-wide layoffs, or preventing them from working on desirable projects.
The lawsuit specifically named Alex Afrasiabi, the former creative director on World of Warcraft, as an individual at the center of several of these allegations, including an allegation in the amended lawsuit by former software engineer Cher Scarlett that she had been harassed by Afrasiabi at a work event, and that a friend told her she experienced something similar a year prior at BlizzCon. Activision Blizzard later reported that Afrasiabi had been fired for misconduct in mid-2020 after their own internal investigation found him and two others at fault for similar misconduct between 2018 and 2020. The lawsuit listed an unnamed Chief technology officer, whom Scarlett alleged in a series of tweets to be Ben Kilgore. The allegations were later corroborated by Bloomberg News and The Wall Street Journal. Kilgore, who had previously worked as a VP at Microsoft, was terminated in 2018 for misconduct. Three other employees, including one known to be involved in incidents related to the 2013 "Cosby suite", were no longer working for the company by August 11, 2021. One of these employees included Jesse McCree, who was the namesake of the Overwatch character McCree.
Other parts of the complaint were focused on the discriminatory treatment of female employees, particularly women of color, in hiring, pay, assignment, promotion, and firing and constructive dismissal. Women were reportedly universally paid less and offered less stock and incentive pay than their male colleagues, beginning when they were hired and continuing throughout their employment. The lawsuit also alleges they had to work much harder to be promoted, or were passed over entirely. Some women employees reported being denied promotions due to fears they might become pregnant, being reprimanded for needing to go pick up their children, and being kicked out of lactation rooms by male colleagues who wanted to meet in the room. Some factors alleged by the DFEH were in connection with poor reporting of workplace harassment, but the suit also contends that Activision Blizzard overall failed to properly consider diversity in hiring and promotion practices.