Activision Blizzard SEC Investigation: Chief Legal Officer Departs

Activision Blizzard Faces Mounting Scrutiny

The repercussions are intensifying for gaming industry leader Activision Blizzard. This follows a significant state investigation initiated this summer concerning allegations of discriminatory practices within the workplace and instances of sexual harassment.

Federal Investigation Launched by the SEC

Activision Blizzard has now confirmed it is under federal investigation by the Securities and Exchange Commission (SEC). The SEC has been increasing its regulatory enforcement efforts directed towards technology companies in recent months.

Reports from the Wall Street Journal indicate the SEC has issued subpoenas to Activision Blizzard and several of its top executives, including CEO Bobby Kotick. Activision Blizzard acknowledged the SEC investigation on Tuesday through a statement to investors.

Details of the SEC Subpoena

The company stated it “continues to productively engage with regulators.” These include the SEC, the Equal Employment Opportunity Commission (EEOC), the National Labor Relations Board (NLRB), and the California Department of Fair Employment and Housing (DFEH).

According to the WSJ, the SEC has requested a range of documents. This includes “minutes from Activision board meetings dating back to 2019, personnel files of six former employees, and separation agreements reached this year with staff members.”

The agency is also seeking any records of communication between Kotick and other executives regarding allegations of sexual harassment and discrimination within the company.

California Lawsuit and Employee Response

The California Department of Fair Employment and Housing filed a lawsuit against Activision Blizzard in July. The suit alleges the creation of a hostile work environment, characterized as a “frat house” culture where gender-based harassment and discrimination were commonplace.

An initial response from company leadership, dismissing the lawsuit as the actions of “unaccountable state bureaucrats,” sparked a significant employee walkout. This protest garnered widespread support from the gaming community and amplified attention to the alleged years of suffering experienced by Blizzard workers.

Impact on the Gaming Industry

Activision Blizzard is the publisher of highly successful gaming franchises, including Call of Duty, World of Warcraft, Overwatch, and Starcraft. The increased regulatory scrutiny surrounding the alleged toxic work environment could have substantial consequences.

These implications extend beyond Activision Blizzard, potentially reshaping workplace culture throughout the entire gaming industry.

Executive Departures

Following the public disclosure of the state lawsuit, J. Allen Brack, former president of Blizzard Entertainment, departed from the company. Jesse Meschuk, the global HR head, also left his position.

On Tuesday, Claire Hart, Blizzard Entertainment’s Chief Legal Officer, announced her departure. This signals a further response to the ongoing regulatory challenges.

Hart shared on LinkedIn, “The past three years have been full of unexpected twists and turns, but I feel honored to have worked with and met so many great people at Blizzard and across the Activision Blizzard businesses.”