Bobby Kotick: progress in lawsuit over Microsoft’s acquisition of Activision

In a recent statement, Bobby Kotick, former CEO of Activision Blizzard, said the lawsuit against Microsoft’s $67.8 billion acquisition of Activision may have been filed to help Embracer Group expand its market share in California. The claim was made in connection with a case brought by Swedish pension fund Sjunde AP-Fonden (AP7) in Delaware’s Court of Chancery at the end of 2022.

Details of the case

The lawsuit targets the acquisition, which AP7 says was pushed through too quickly to avoid possible legal consequences for Kotick tied to allegations of misconduct during his time as CEO. Kotick questioned the claims made in the case and suggested that Embracer Group may have worked with AP7 to harm Activision. "This Delaware lawsuit was apparently aimed at helping Embracer strengthen its presence in the California market at Activision’s expense," Kotick said.

Embracer Group, however, denied any involvement in the lawsuit and stressed that it did not need help from a Swedish pension fund in its competition with Activision.

Bobby Kotick’s response and recent history

Kotick, who has previously faced heavy criticism over allegations that he mishandled sexual harassment and discrimination cases at Activision, has in the past described lawsuits filed against his company as "fake lawsuits." He claimed those cases were part of a strategic plan by a union to grow membership. Kotick has also dismissed a petition signed by around 1,300 Activision Blizzard employees calling for his removal as "fake," though he did not specify which parts of the document he believed were inaccurate.

Activision Blizzard was rocked in 2021 by allegations that the company had a "frat boy" culture, including claims of sexual harassment and gender discrimination. Criticism of Kotick’s handling of the situation intensified, especially after a revealing Wall Street Journal report raised questions about what he knew regarding past allegations.

Microsoft’s acquisition

Microsoft’s acquisition of Activision Blizzard, announced in January 2022, will significantly expand Microsoft’s gaming portfolio, including major franchises such as Call of Duty. The deal is valued at $67.8 billion. However, the acquisition has not been without controversy, given increased scrutiny over competition rules and the impact on the gaming market.

Kotick’s comments about the AP7 lawsuit and Embracer Group add another layer to the legal complications surrounding the deal. Microsoft has said it remains committed to completing the acquisition despite legal and regulatory hurdles.

The complexity of the lawsuit and the surrounding debate continues to evolve. Activision Blizzard and the parties involved are preparing for the next legal steps, while the case continues to shape the future of this major gaming industry acquisition.