Activision Blizzard confirms SEC investigation, loses chief legal officer

The consequences are mounting for gaming giant Activision Blizzard after the company became the subject of a landmark state investigation into discriminatory workplace practices and sexual harassment this summer.

Now, Activision Blizzard confirms that it is the subject of a federal investigation by the Securities and Exchange Commission, which has been ramping up enforcement efforts against tech companies in recent months.

The Wall Street Journal reported Monday that the SEC has subpoenaed Activision Blizzard and a number of the company’s key executives, including CEO Bobby Kotick. Activision Blizzard confirmed the SEC investigation Tuesday in a statement to investors, noting that it “continues to productively engage with regulators” including the SEC, the Equal Employment Opportunity Commission, the National Labor Relations Board and the California Department of Fair Employment and Housing.

The SEC requested documents from the company, including “minutes from Activision board meetings since 2019, personnel files of six former employees and separation agreements the company has reached this year with staffers,” according to the WSJ. The paper also reported that the agency is seeking any records between Kotick and other executives discussing sexual harassment and discrimination allegations at the company.

The California Department of Fair Employment and Housing sued Activision Blizzard in July over allegations that it created a hostile “frat house” environment in which gender-based harassment and discrimination were routine.

Following an inflammatory response from the company’s leaders, who dismissed the lawsuit as the actions of “unaccountable state bureaucrats,” a group of employees staged a high-profile walkout. The protest attracted solidarity from many corners of the gaming world and drew more attention to the workplace environment in whuch many Blizzard workers allegedly suffered for years.

Activision Blizzard publishes some of the biggest titles in gaming, including the Call of Duty franchise, World of Warcraft, Overwatch and Starcraft. The flurry of regulatory interest in allegations of a toxic, hostile work environment at the company could have far-reaching implications for workplace culture not just at Activision Blizzard, but for the gaming industry at large.

After the state lawsuit became public, former president of Blizzard Entertainment, J. Allen Brack¬†left the company, followed by its global HR head Jesse Meschuk. On Tuesday, Blizzard Entertainment Chief Legal Officer Claire Hart became the latest high-profile employee to announce their departure, signaling that she wouldn’t be sticking around to weather the regulatory storm.

“The past three years have been full of unexpected twists and turns, but I feel honored to have worked with and met so many great people at Blizzard and across the Activision Blizzard businesses,” Hart wrote on Linkedin.