Videogame developer Activision Blizzard agreed to pay a $35 million settlement on charges that it failed to maintain «proper» workplace harassment reporting procedures and violated federal whistleblower protection rules, the Securities and Exchange Commission said friday.
The SEC asserted that workplace misconduct complaints were not collected and analyzed by employee complaints as expected by public disclosure regulations. «In addition, taking steps to prevent former employees from directly communicating with Commission staff about a potential securities law violation is not only bad corporate governance, it’s illegal,» said SEC Chairman Jason Burt. .
The settlement is not an admission or denial of wrongdoing, but instead concludes an investigation that focused on Activision Blizzard’s standards from 2018 to 2021.
Activision Blizzard CEO Bobby Kotick was aware of reports of alleged sexual misconduct at the company, including alleged rape.The Wall Street Journal reported in 2021.
«Mr. Kotick would not have been informed of all reports of misconduct at all Activision Blizzard companies, nor would he reasonably be expected to have been updated on all personnel issues,» an Activision Blizzard spokesperson said at the time.
The SEC filing claimed that Activision Blizzard required «a significant number» of employees who were leaving and signed separation agreements to tell Activision Blizzard if regulators attempted to contact them, or even if those employees wanted to file a complaint on their own. Activision Blizzard’s requirement that former employees notify the company violated federal whistleblower protections, the SEC said.
The SEC’s order did not explicitly mention Kotick’s claims or sexual harassment by some employees. Activision Blizzard had been under SEC investigation for the company’s handling of sexual and personal harassment since 2021, the Wall Street Journal previously reported. reported.
Activision took steps from 2020 to 2022 to improve procedures for handling employee complaints, the SEC Order Annotated.
“As the order acknowledges, we have enhanced our disclosure processes regarding workplace reporting and updated our separation contract language,” an Activision Blizzard spokesperson said Friday.
The company settled an Equal Employment Opportunity Commission investigation in March 2022 for $18 million for related claims of retaliation in connection with sexual harassment claims.
In December 2022, the Federal Trade Commission decided to block Microsoft Activision acquisitionwhat was it announced in january that year, alleging that the agreement would violate federal antitrust laws.