U.S. District Judge Dale Fischer approved a $18 million relief settlement with the Equal Employment Opportunity Commission today. This settlement comes months after Activision Blizzard originally agreed to settle with the EEOC on September 27, 2021. But those attempting to hold the game publisher to account are split on how much of a win this will ultimately be for the victims of Activision Blizzard’s “frat boy” culture.
During the settlement hearing, a lawyer acting on behalf of the California Department of Fair Employment and Housing (DFEH) argued that the EEOC’s motion to proceed with the settlement was in violation of states’ rights to its own jurisdiction. He stated that the EEOC’s intervention was due to the egregiousness of Activision Blizzard’s violation and not due to normal legal process.
The EEOC argued that the DFEH has had months to make the federalism argument but has instead chosen to broach it at the “eleventh hour.” The DFEH was accused of derailing and delaying the settlement proceedings while Activision Blizzard was cooperative with the federal government. The exasperated judge reiterated that the DFEH’s argument was “untimely” and that anyone who disagreed with the settlement could take it to the ninth circuit court.
According to the Washington Post, the settlement could prevent the DFEH, which is also pursuing legal action against Activision Blizzard, from seeking further monetary damages. This means the settlement could be a loss for both the DFEH’s case and sexual harassment victims of the company because state agency has historically been more aggressive than federal proceedings, like that of the EEOC.
The DFEH is pursuing its own lawsuit against the Call of Duty publisher, but the organizations claimed the EEOC settlement contains a clause that allows Activision Blizzard to remove sexual harassment allegations from the files of settlement claimants, hindering the DFEH trial. The EEOC’s opposition, which was filed March 24, disputes this saying the consent decree does not require or authorize the destruction of these documents. The settlement also allows the publisher to use unclaimed funds for its own women’s charity funds. DFEH is wary that control over some of the money could return to the company that the settlement is meant to punish.
The original proceedings were held up by the DFEH, which filed a motion to intervene last October. However, that October filing allowed the EEOC to respond with its own opposition, which claimed that the DFEH lawyers were under ethical violations.
Last October, Communications Workers of America also filed an objection against the then-possible settlement with the EEOC. In the labor union’s view, $18 million dollars (or $450 per claimant) is a drop in the bucket for Activision Blizzard, which paid $150 million to its CEO Bobby Kotick in 2020. In fact, leaving Activision Blizzard will reportedly give Kotick a payout of $390 million dollars. Which is an enormous amount of money for the man who received a vote of no confidence from 1,200 employees.
The DFEH lawsuit is currently set for February 27 2023.
Correction: 3/29/22 4:46 p.m. ET: This piece was updated with information from an Activision Blizzard spokesperson about the DFEH’s claim regarding the removal of allegations relevant to its own lawsuit.