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Thursday, March 28, 2024 | Back issues
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Activision wins approval of $18 million EEOC settlement over California’s objections

California says the federal settlement will let Activision escape liability under more stringent state laws.

LOS ANGELES (CN) — Activision Blizzard — maker of the "Call of Duty" and "World of Warcraft" video games — won a federal judge's approval Tuesday of a $18 million settlement with the Equal Employment Opportunity Commission over allegations of sexual harassment and discrimination in its workplace.

U.S. District Judge Dale Fischer in Los Angeles approved the consent degree between the company and the EEOC over the objections of the California Department of Fair Employment and Housing, which has a separate lawsuit pending against Activision in state court on similar claims. Fischer's approval came a day after the Ninth Circuit denied California's emergency request to stay the federal case while it appeals Fischer's refusal to allow the state to intervene.

California has faulted the EEOC for handing Activision leverage to walk away cheaply from the sexual harassment and discrimination claims under the state's own laws, which are far more protective of workers than federal laws. According to California, Activision workers who participate in the EEOC settlement must waive their right to participate in the state case.

"By offering only pennies on the dollar to victims of Activision’s discrimination and harassment, with no formal discovery or litigation whatsoever, the decree would actually create hardship for EEOC by doing serious long-term damage to its mission and reputation in California and beyond," the California Department of Fair Employment and Housing said in its January motion to stay the federal case.

Activision, based in Santa Monica, California, didn't admit wrongdoing as part of the EEOC settlement. Microsoft has agreed to buy the company for nearly $70 billion.

The company has accused California of rushing its lawsuit to court as part of a turf war with the EEOC. The federal agency filed its lawsuit after California had filed its case in state court, and included the consent agreement to settle its claims against the company. Activision has claimed California violated a work agreement with the EEOC that would leave the sexual harassment claims for the federal agency to investigate and resolve.

At Tuesday's hearing, an attorney for the state made a final, unsuccessful bid to argue that the EEOC has to defer to California in enforcing labor law violations. Fischer rebuffed the attempt to halt approval of the settlement and said the state would have to take up the issue with the Ninth Circuit.

In denying the state's request to intervene in the EEOC litigation, the judge said this past December that nothing in the consent degree before her prevented California from reaching its own settlement with Activision.

"Individual Californians have a right to settle their claims with or without counsel and without input from DFEH — or the EEOC for that matter," the judge said in her December ruling.

California previously struck a tough attitude in pursuing sexual harassment and discrimination claims in the video game industry when it opposed a $10 million settlement of a class action against Riot Games. After the department intervened in that case, the “League of Legends” publisher agreed to pay $100 million to settle the case.

Aside from the lawsuits by government agencies, Activision also faces multiple lawsuits by individual women who claim they were victims of a "frat house" culture at the company.

Follow @edpettersson
Categories / Business, Courts, Government, Technology

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