Activision Blizzard is once again being sued, this time in a class-action lawsuit which claims the company made “false and misleading” statements to shareholders regarding the ongoing investigation, and eventual lawsuit, by the California Department of Fair Employment and Housing.
The lawsuit, filed in California’s Central Distirct and brought by the Los Angeles-based Rosen Law Firm, alleges that Activision Blizzard did not properly inform shareholders about the two-year investigation and is now seeking for damages to those who have recently obtained Activision Blizzard stock.
The suit also alleges that the statements about the company’s business operations were in violation of federal securities law. It adds that “as a result of Defendants’ wrongful acts and omissions, and the precipitous decline in the market value of the Company’s common shares, Plaintiff and other Class members have suffered significant losses and damages.”
Activision Blizzard stock has already seen a decline since the news of the original lawsuit went public, and is currently down more than 7% over the past five days. Statements regarding the state lawsuit from Activision Blizzard executive vice president Fran Townsend, and later CEO Bobby Kotick, caused thousands of current and former employees to sign an open letter on July 27th, demanding change. Hundreds on employees walked out in protest on July 28th.
This new lawsuit was filed by plaintiff Gary Cheng, who purchased Activision Blizzard shares sometime within the last five years. The lawsuit names Bobby Kotick, as well as current Activision Blizzard chief financial officer Dennis Durkin and former chief financial officer Spencer Neumann, as defendants.