Activision Blizzard Settles Significant Gender Discrimination Lawsuit for Approximately $54 Million

After more than two years since the California Civil Rights Department (CRD) initiated a high-profile lawsuit against Activision Blizzard, alleging extensive gender discrimination and pay disparities, the two parties have reached a settlement of approximately $54 million.

The Wall Street Journal broke the news of the settlement on Friday, followed by a statement from the CRD on its website. Pending court approval, Activision Blizzard will undertake additional measures to enhance fair pay and promotion practices within the company, as outlined in the settlement, which also includes providing monetary relief to women employed by or contracting with Activision Blizzard between October 12, 2015, and December 31, 2020. The CRD indicates that approximately $45 million of the settlement will be allocated to a fund for compensating affected workers. Any surplus funds will be directed to charitable organizations, with a focus on advancing women in video games and tech or supporting initiatives that raise awareness of gender equality issues in the workplace.

The lawsuit against Activision Blizzard, filed by the California Department of Fair Employment and Housing (formerly known as the California Department of Fair Employment and Housing), in 2021 stemmed from a two-year investigation. The legal action alleged multiple violations of California’s Equal Pay Act and Fair Employment and Housing Act, citing a pervasive “frat boy” culture that discriminated against women within the company.

Despite Activision Blizzard’s repeated denials, the lawsuit persisted, and the company’s attempt to have it dismissed was unsuccessful in October 2022. The controversy surrounding the lawsuit was one of the factors influencing Microsoft’s acquisition of Activision, with the latter’s stock facing significant declines.

Bobby Kotick, the contentious CEO, has confirmed his tenure will extend only until the end of 2023 post the acquisition, and no new CEO has been appointed yet.

According to sources cited by the Wall Street Journal, the regulatory body initially sought a settlement far exceeding the one reached with Riot Games in December 2021. In 2021, the California Department of Fair Employment and Housing estimated Activision Blizzard’s potential liability to be close to $1 billion.