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Riot Games Denies Claim It Hampered Bias Probe as Agency ‘Smear’

Aug. 17, 2021, 11:28 PM

Riot Games Inc., a unit of Tencent Holdings Ltd., denied claims Tuesday from a California agency that it was misleading employees about their rights to speak to regulators about sexual harassment allegations at the company, calling the accusations an effort to “smear” the video game maker.

The California Department of Fair Employment and Housing is a “rogue, press hungry agency,” Riot told the Los Angeles Superior Court, and is making improper allegations “to gin up a misleading press release and tweets to smear Riot Games.”

The company behind popular video games such as League of Legends was responding to allegations from the agency that Riot Games was ignoring a court order to instruct employees on their right to speak with the agency about allegations of workplace harassment and bias.

DFEH intervened in a lawsuit filed by two female Riot employees in California state court in November 2018. They had alleged sexual harassment, discrimination, and retaliation on the basis of sex, describing instances of emails rating the physical attractiveness of female employees, unsolicited photos of male genitalia, and unequal pay.

In 2019, Riot announced it had reached a class settlement, which DFEH opposed.

In a statement Monday, the agency said Riot negotiated “secret settlements” with approximately 100 women who agreed to waive their claims and rights. The settlements also didn’t include notice of the agency’s own pending enforcement action against Riot, stemming from an investigation — beginning in October 2018 — into allegations of sexual harassment, sex discrimination, and sexual assault.

The agency alleged Monday that Riot failed to comply with an order to issue a corrective notice to employees, clarifying their rights to speak with regulators about their employment with the game maker.

The company pushed back on those allegations. Riot has repeatedly communicated to its employees that they may speak with DFEH without fear of retaliation, the company’s Tuesday filing said. The order requiring a corrective notice only reinforces what Riot has already told its workforce, it said. “Yet DFEH persists with its false narrative.”

The agency was unhappy with the court’s approach, which stated that nothing in the notices should include suggestions that the court had made a ruling as to whether the settlement agreements were illegal, Riot Games said. The company said the agency had “hijacked the narrative by bringing an ex parte application as Trojan Horse to allow it to deliver its preferred message to the press.”

DFEH asked the court to order Riot to produce a list of employees who will receive the notices by Aug. 19. But Riot had previously agreed to produce the remaining contact information by Aug. 20, it told the court, and notices have already been sent to 66 recipients. The agency can’t articulate any harm that will occur from waiting one day, Riot said.

Gibson, Dunn & Crutcher LLP represents Riot.

The case is McCracken v. Riot Games Inc., Cal. Super. Ct., No. 18STCV03957, 8/17/21.

To contact the reporter on this story: Maeve Allsup in San Francisco at mallsup@bloomberglaw.com

To contact the editors responsible for this story: Rob Tricchinelli at rtricchinelli@bloomberglaw.com; Meghashyam Mali at mmali@bloombergindustry.com

© 2021 Bloomberg L.P. All rights reserved. Used with permission.

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