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Activision ‘Frat Boy’ Suit Jolts Effort to Change Gaming Culture

July 26, 2021, 6:26 PM

A lawsuit against Activision Blizzard Inc. could be a crucial step to forcing the video-game industry, which has faced persistent allegations of workplace sexual harassment, to take meaningful steps toward gender equality, advocates said.

The California Department of Fair Employment and Housing sued the maker of World of Warcraft and other well-known games, alleging the company encourages a “frat boy” culture where female workers face sexual harassment, unequal pay, and retaliation. The allegations in the July 20 lawsuit sparked a firestorm in the gaming community, with many saying it showed an industry rife with abuse and resistant to change.

Lawyers said legal action would be critical to encouraging more workers to speak out against abuses and raise the financial stakes for companies to address workplace bias and prioritize the hiring of underrepresented workers.

Workers have turned to social media to publicize similar allegations against prominent video game developers, such as Riot Games Inc. and Ubisoft Entertainment SA, and individuals in the gaming world, including executives, designers, and writers. However, industry-wide change will occur when allegations hit companies hard financially, said Elizabeth Tippett, a professor at University of Oregon’s law school. Tippett said regulators are trying to send a message to the industry.

“One of the things we need to see over time is a consistent pattern of really big settlements, really big verdicts,” she said. “Companies generally aren’t that motivated to take aggressive approaches unless there’s a lot of money on the line—or PR.”

Wake Up Call

According to the DFEH suit, female employees were subject to sexual and other derogatory comments, and inappropriate behavior. The suit alleged women received lower pay, were promoted more slowly than male counterparts, and fired more quickly. The agency is seeking an injunction on behalf of employees, as well as penalties under the California Equal Pay Act, including unpaid wages.

The lawsuit will make companies take notice by seeking money for affected workers, said Dr. Ann Olivarius, who focuses on work discrimination and harassment suits as chair and senior partner of McAllister Olivarius.

“This could be millions,” she said of the monetary impact, and “the company will feel it, in terms of reputation.”

In a statement on July 21, a spokesperson for Activision Blizzard said the agency complaint “includes distorted, and in many cases false, descriptions of Blizzard’s past.”

“There is no place in our company or industry, or any industry, for sexual misconduct or harassment of any kind,” the statement said. “We take every allegation seriously and investigate all claims. In cases related to misconduct, action was taken to address the issue.”

Activision Blizzard didn’t immediately respond to a request for comment on this story.

Agency Action

California regulators have looked at harassment and bias allegations in the gaming industry before. In 2018, DFEH opened a similar investigation into Riot Games Inc., a case highlighting the complicated path to seeking redress for alleged victims of workplace harassment.

Shortly after DFEH opened its investigation, a class of female employees who said Riot Games denied them equal pay, stifled promotions, and subjected them to sexual harassment filed suit. The complaint made similar complaints to the Blizzard suit. According to the complaint, a Riot email chain rated the company’s “Hottest Women Employees.”

But in January 2020, the DFEH stepped in to block a proposed $10 million settlement, which came as regulators were attempting to obtain critical pay data from Riot, the agency said. The settlement would have grossly undercompensated female employees for claims that could have been worth as much as $400 million, according to the agency.

The class gained new representation in January 2020, and the proposed settlement was withdrawn. The parties held informal discovery conferences in July 2021 but no trial date is currently set.

VIDEO: The two most important laws addressing pay discrimination between genders have been around for more than six decades, yet the pay gap persists. In this video, we look at the laws and court cases used to enforce equal pay for equal work, and discuss what comes next with Sen. Kirsten Gillibrand, and EEOC Chair Charlotte Burrows.

‘Tip of the Iceberg’

Cher Scarlett worked as a software engineer at Blizzard for a year, starting in August 2015.

“I saw and heard about some of the most heinous things I have ever heard of, to the point where, when I was sexually harassed and groped, I didn’t think it was a very big deal, because I had heard of so much worse,” she said.

Scarlett said the culture of secrecy around releasing new games, arbitration clauses in employee contracts, and lengthy non-disclosure agreements, are part of the reason employees don’t speak out.

“When you’re in this culture of secrecy, keeping things secret before they ship, people are literally scared that they can’t talk to anyone about what’s going on in the company, so they don’t talk to a lawyer because they don’t know their rights, and they don’t think anyone will believe them,” Scarlett said.

Independent game developer Rosa Carbó-Mascarell likened the recent claims at Blizzard to a third wave of #MeToo allegations in the gaming industry.

“Last year it was Riot, another time it was Ubisoft, and the indie scene is also not exempt. There have been a lot of brave marginalized people who have come out about the abuse they suffered at the hands of men in the industry,” she said.

London-based Carbó-Mascarell , whose clients include Google, Samsung, and Nexus Studios, created a game to “air out” gaming culture and depict her own experiences as a woman in the industry.

“What is truly upsetting is that the stories we hear in public are only the tip of the iceberg,” she said. “A handful of stories and names get passed along whisper networks and thousands more stories never even leave a small circle of trusted friends.”

Next Steps

One solution to address widespread harassment in the industry is to hire more from historically underrepresented groups, attorneys and academics said. A 2019 survey of more than 1,100 game developers by the International Game Developers Association found that 71% of respondents identified as male while 24% identified as female. More than 80% of respondents identified as White.

“You have to think about who’s at the table,” said Dr. Kishonna Gray, a professor at the University of Illinois Chicago who has researched identity and video games, among other topics. “That’s where they need to change the template.”

For Carbó-Mascarell , industry change will come from financial pressure.

“We need to go straight to the bosses of abusive people and companies. Even the C-suites are governed by investors and a board of directors. We need to disrupt their ability to make capital until investors and boards are forced to fire these abusive men in power,” she said.

Scarlett said she was already seeing the impact of the Blizzard suit, with dozens of current and former employees reaching out to her about how they could be added as witnesses to the DFEH complaint.

“As each suit gets brought, it gets easier and easier,” added Olivarius. “It’s really tough to take on an employer by yourself if you don’t do it in a lawsuit.”

To contact the reporters on this story: Paige Smith in Washington at psmith@bloomberglaw.com; Maeve Allsup in San Francisco at mallsup@bloomberglaw.com

To contact the editors responsible for this story: Meghashyam Mali at mmali@bloombergindustry.com; Jay-Anne B. Casuga at jcasuga@bloomberglaw.com

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