Activision Blizzard Inc. one of the most successful video game development and publishing companies has agreed to pay $35 million to settle regulatory charges concerning its process for determining whether its disclosure to investors should ijnclude any employee complaints about workplace misconduct. It was also charged with violating the whistleblower protection rule. Previously the Wall Stree Journal had reported that female employees at activision complained for years about alleged sexual assaults and mistreatment. In 2021, the company paid $18 million tot he Equal Employment Opportunity Commission to settle allegations of gender based harassment and retaliation.
The SEC’s Order https://www.sec.gov/litigation/admin/2023/34-96796.pdf Finds that Activision failed to implement necessary controls to collect and review employee complaints about worplace misconduct which left it without the means to determine whether larger issues existed that needed to be disclosed to investors. The resolution is considered significant and a warning to other publicly traded companies and financial institutions subject to the SEC jurisdiction that these controls are essential and that the SEC is payaing close attention to similar situations in other corporations.
Without admitting or denying the SEC findings, Activision agreed to a cease and desist order and to pay the $35 million penalty.
Also in an article on Nov 16, 2021, the Wall street Journal write that Activision CEO Bobby Kotick knew for years about sexual misconduct allegations at the company https://www.wsj.com/articles/activision-videogames-bobby-kotick-sexual-misconduct-allegations-11637075680.
The SEC’s investigation was conducted by Eric Day, Yamini Piplani Grema, and Daniel Konosky and was supervised by Danielle Voorhees and Jason Burt.
Jeffrey Newman is a whistleblower lawyer who handles SEC whistleblower cases and False Claims Act cases who can be reached at 978-880-4758 or at jeff@jeffnewmanlaw.com
