Activision Blizzard faces another lawsuit, this time in behalf of investors
Activision Blizzard is facing a new class-action lawsuit filed in the U.S. District Court of Central California. The Rosen Law Firm filed a suit on behalf of Activision Blizzard investors, alleging the company’s “intentional failure” to disclose its ongoing problems with sexual harassment and discrimination. This comes in after the most recent investor’s call since the California Department of Fair Employment and Housing’s lawsuit came to light.
Since the first lawsuit, Activision Blizzard’s stock prices have taken a nosedive. This understandably triggered concern within the company’s investors. Thus, leading to the second lawsuit. The class-action lawsuit covers anyone who has traded in Activision Blizard securities from August 4, 2016, to July 27, 2021. It seeks damages based on violations of federal securities laws. The company violated these “by issuing materially false and misleading statements during the class action period.”
The case names Activision Blizzard, the corporate entity, as a defendant. Additionally, it includes CEO Bobby Kotick, CFO Dennis Durkin, and former CFO Spencer Neumann. The suit states that these three executives were “instrumental in the spreading of false information.”
The class-action lawsuit claims that Activision Blizzard and its executives were aware of the company’s issues of rampant sexual harassment and discrimination. However, they did not disclose this information in their SOX certifications (Sarbanes-Oxley Act of 2002). The SOX certification is a yearly document that is signed by executives. It discloses potential legal issues, investigations, audits, or other procedures that could affect the value of the business.
Notably, The Rosen Law Firm is the same law firm behind the class-action lawsuit filed against CD Projekt Red due to the abysmal launch of Cyberpunk 2077.