The Real Reason Activision Blizzard Has Been Hit With Six New Lawsuits

Microsoft's announcement of its $68.7 billion acquisition of Activision and its subsidiaries was probably the biggest piece of gaming industry news of the year so far. It marked an unparalleled joining of two major entertainment entities and will consolidate ownership of dozens of major franchises such as "Call of Duty," "World of Warcraft" and "Overwatch" under Microsoft's umbrella. 

It's hard not to consider the timing of the purchase, though. Activision Blizzard has been fielding a flurry of lawsuits over the past year. The company's shady side was exposed when numerous employees came forward with allegations of sexual misconduct and a toxic workplace environment. The resulting bad press, protests and boycotts have dominated much of the news surrounding the company in the weeks since. Even the government has gotten involved, with the SEC investigating whether the company properly disclosed these allegations to its investors.

On top of all that, Activision Blizzard is now facing six new lawsuits, although these seem to be unrelated to the allegations put forward by the company's employees. Instead, these new suits have been filed by Activision Blizzard's own shareholders, who have taken issue with aspects of Microsoft's acquisition of the company.

The first suit was filed by shareholder Kyle Watson against Activision Blizzard and the company's board of directors. Watson's suit claims that the upcoming sale is a violation of the Securities and Exchange Act of 1934. It also states that Watson is arguing this merger "is unfair for a number of reasons," that "the Activision Board failed to create and independent committee composed of disinterested directors to run the sales process," and that "it appears as though the board has entered into the Proposed Transaction to procure for themselves and senior management of the Company significant and immediate benefits." 

Overall, it seems Watson is arguing that there are several conflicts of interest involved in the sale and that it may benefit Activision Blizzard executives at the expense of the company's shareholders. This comes at a time when fans are already seeing red over the reveal that CEO Bobby Kotick could receive a $22 million stock bonus if Activision Blizzard should make "appropriate progress" toward fixing the workplace culture — a problem that many blame him for fostering in the first place.

Watson filed on February 24, 2022, just before a second lawsuit was filed by Shiva Stein citing many of the same issues the very same day. Polygon has reported that four more suits have been filed since then, all surrounding similar arguments, bringing the total up to six. 

Polygon also reached out to an Activision Blizzard spokesperson for comment, who responded, "We disagree with the allegations made in this complaint and look forward to presenting our arguments to the Court."