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Activision Avoids California Bid to Intervene in Settlement (1)

Dec. 13, 2021, 10:37 PMUpdated: Dec. 14, 2021, 12:37 AM

A federal judge said she would reject California’s bid to intervene in Activision Blizzard Inc.‘s proposed $18 million settlement over sexual harassment and discrimination claims with the U.S. Equal Employment Opportunity Commission.

“I’m not going to allow the DFEH to intervene, it’s just not appropriate,” Judge Dale S. Fischer, of the U.S. District Court for the Central District of California, said in a remote hearing Monday, referring to the state’s Department of Fair Employment and Housing.

Fischer’s final ruling on California’s motion is forthcoming but the judge told the parties, “It’s highly unlikely that I would change my mind and allow the DFEH to intervene.”

The ruling, which will block DFEH from formally joining the case, may allow Activision to begin resolving some of its legal challenges over the alleged harassment of female employees. But that doesn’t necessarily mean the court will approve the proposed settlement itself, Fischer said.

“The fact that this particular decree is consistent with others doesn’t necessarily mean that in this case, I’m going to approve it,” she said.

The EEOC announced in September it had reached a settlement with Activision, resolving claims over the company’s alleged toxic workplace culture. The agency said it received an anonymous complaint about Activision from an employee, which led to a multi-year investigation, culminating in the proposed settlement.

California’s DFEH, which conducted its own investigation and sued Activision in state court in July, said the EEOC settlement would release Activision from state claims, which the federal agency lacks standing to prosecute. The state agency sought to join the federal case in order to object to the settlement.

Agencies Scolded

Judge Fischer said she would allow the state agency to file an amicus brief in the federal case, but scolded both agencies for their very public dispute over the Activision allegations.

“This is a bit unseemly,” Fischer told the agencies. “I feel like I should send the two of you to a mediator, never mind Activision getting involved in this.”

“You apparently have been working well together for a very long time, and you’ll have to be working well together in the future,” Fischer said. “It seems like not only the defendant but also some of these employees and former employees are going to get caught in the middle here and that’s not appropriate.”

Activision and the EEOC will submit clarifications on the proposed consent decree for the settlement to the court in early January. The DFEH will have 14 days to submit comments.

“I may have a hearing and I may not,” Fischer told the DFEH about the consent decree. “If I like the way the consent decree looks and I want to sign it, I’m going to sign it.”

The case is EEOC v. Activision Blizzard, C.D. Cal., No. 2:21-cv-07682, hearing 12/13/21.

(Updated throughout with additional reporting.)

To contact the reporter on this story: 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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