Activision Blizzard to pay more than $54 million in gender discrimination settlement

$54,875,000.

That's the amount that Activision Blizzard has agreed to pay to settle the equal pay and discrimination lawsuit that paved the way for Microsoft's acquisition of the video game company behind hit titles such as World of Warcraft and Call of Duty. The Civil Rights Department (CRD) of the State of California announced on Friday that it reached a settlement for more than $54 million with Activision Blizzard in its lawsuit against the company.

What the settlement agreement includes

The CRD sued Activision Blizzard in 2021, alleging that executives "discriminated against women at the company." This included allegations that the company's leadership ignored sexual harassment complaints as well as equal pay discrimination involving women being paid less than men for similar work and women being denied promotions within the organization.

However, as Engadget and MarketWatch point out, as part of the settlement, the CRD will withdraw its allegations of widespread sexual harassment at the company.

Along with the substantial financial settlement, Activision Blizzard has also agreed to work towards resolving these issues and ensuring fair pay and promotion practices at the company. In addition, the settlement agreement involves providing monetary compensation to women in California who worked for the company between October 2015 and December 2020. Approximately $45,750,000 of the more than $54 million settlement will go towards a fund to compensate these workers.

"California remains deeply committed to promoting and enforcing the civil rights of women in the workplace," said CRD Director Kevin Kish in a statement. "If approved by the court, this settlement agreement represents a major step forward and will bring direct relief to Activision Blizzard workers. At the California Civil Rights Department, we will continue to do our part to fight for the rights of our state’s residents."

As the Wall Street Journal reports, this lawsuit was significant for the video game giant as it opened the window of opportunity for Microsoft to acquire Activision Blizzard. In 2021, reports revealed that Activision CEO Bobby Kotick concealed sexual harassment allegations from the company's board. In the aftermath of this revelation, the company's stock dropped. Microsoft then entered the picture, offering to acquire the company for more than $68 billion.

The settlement agreement still needs to be approved and finalized by a court. If that happens, as the Wall Street Journal points out, the Activision Blizzard settlement would be the second-largest in the CRD's history.