Activision CEO Bobby Kotick and a few shareholders are in for a rough time. The City of New York has filed a lawsuit against Activision targetting Bobby Kotick and the documents pertaining to the ongoing Microsoft deal and more.
The suit was filed by a group called the New York City Employees’ Retirement System which reportedly owns Activision stock. The group claims that Activision’s recent sexual harassment trial hurt the company’s value. The lawsuit is in action in Delaware’s Court of Chancery which allows stockholders to request companies open their books to expose potential corruption and fraud.
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The lawsuit is quite a complicated one. New York City is demanding that Activision provide a long list of documents related to the ongoing Microsoft deal. The city has demanded information on the five buyers cited in the sale information as well as all financial meeting recordings, board memo notes and more.
According to the lawsuit, New York City has been pressing Activision for these files since late 2021. This being after Bobby Kotick was exposed for being aware of the ongoing sexual harassment at the company. However, Activision has been delaying the findings.
The lawsuit also aims to prove that Bobby Kotick and its shareholders rushed to sell Activision after the CEO was exposed for his knowledge of the misconduct. The city claims that this contributed to the company’s loss in value which in turn, reduced share value.
This lawsuit may expose some internal issues that the public isn’t aware of. It could also hinder the sale progress of the company to Microsoft. This lawsuit is just another one added to the pile of issues at Activision. Axios reports the current ongoing legal battles between the company:
- 1 federal harassment suit (settled, though facing appeals)
- 1 discrimination suit from California
- 1 purported class action suit
- 4 shareholder lawsuits (consolidated to two)
- 8 lawsuits over the Microsoft merger (four voluntarily dismissed)
- 2 “220 complaints,” including the one from NYC
- Plus: An SEC investigation and insider trading inquiries from the SEC and Department of Justice
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Source: Axios
