Activision Blizzard Inc. has agreed to pay $35 million to settle SEC charges that it failed to have systems in place to properly handle employee complaint disclosures and violated whistleblower protection rules, the regulator announced on Friday.
According to the SEC, the company was aware that employee retention was a “particularly important risk in its business,” but did not have adequate measures in place to manage workplace misconduct complaints across business units between 2018 and 2021.
“Activision Blizzard failed to implement necessary controls to collect and review employee complaints about workplace misconduct, leaving it without the means to determine whether larger issues existed that needed to be disclosed to investors,” said Jason Burt, director of the SEC’s Denver office.
The popular “Call of Duty” video game developer and publishing company also required employees between 2016 and 2021 to notify the company if the SEC contacted them for information, which the agency said was a violation of whistleblower protection rules.
Activision Blizzard representatives said in a statement that they were “pleased to have amicably resolved this matter” and that they had “enhanced” their workplace reporting and contract language.
The company made changes between May 2020 and May 2022 that improved complaint collection and communication to senior management, according to the SEC’s order.
The Santa Monica, California-based company previously settled a lawsuit filed by the United States Equal Employment Opportunity Commission alleging widespread sex discrimination.
To address widespread allegations of sexual harassment and other misconduct, the company fired a slew of employees. Its board of directors stated that there was no evidence that senior executives intentionally ignored or downplayed the issues.
Microsoft Corp, the maker of Xbox, made a $69 billion bid to acquire Activision Blizzard, but the Federal Trade Commission asked a judge to block the deal in December.
The EU is also looking into the deal.