Activision Investor Suit Gets Mixed Reception at Ninth Circuit

Judges at the Ninth Circuit Thursday questioned whether an alleged culture of sexual harassment at Activision Blizzard Inc., and related investigations, translated to a securities fraud case.

Attorneys for the video game maker, now a Microsoft Corp. unit, and the investors suing it faced inquiries about several essential aspects of the claims: the importance of Activision’s alleged concealment of the state and federal investigations; then-CEO Robert Kotick’s level of intent; and whether the announcement of a suit by the state of California directly affected the stock price.

The investors made a “great case” about bad behavior at the company, ...