Class counsel named in Activision securities case

Laurence M. Rosen and Phillip Kim of the Rosen Law Firm P.A. were appointed lead class counsel in a securities fraud class action against Activision Blizzard Inc., which is facing lawsuits and state and federal investigations over allegations of workplace discrimination.

Their client, 27-year-old Texan Jeff Ross, said the value of his Activision Blizzard stock plunged nearly $12,000 after the investigations were made public. The U.S. Securities and Exchange Commission is investigating whether the game creator company withheld from shareholders information about its workplace problems.

In a ruling Monday, U.S. District Judge Percy Anderson of the Central District of California agreed Ross could serve as the plaintiff in the class action, and that Los Angeles-based Rosen Law Firm was best suited to represent the class.

"The Court finds that on these factual allegations, Movant has the greatest financial interest. Here, Movant, like the putative class members, allegedly suffered losses when subsequent revelations resulted in a decline in Activision Blizzard's share price," Anderson wrote.

The proposed class contends the company failed to tell its shareholders that the state Department of Fair Employment and Housing was investigating its workplace for more than two years. Since 2017, the company has written in SEC filings that might be involved in legal proceedings that could negatively impact the business, but contended it does not tolerate harassment, discrimination or alcohol consumption in the workplace.

Those statements, according to the plaintiffs, were misleading as they failed to tell investors specifically about the government probe. The proposed class covers all who acquired Activision Blizzard securities between Aug. 4, 2016 and July 27, 2021. Cheng et al v. Activision Blizzard Inc; Robert A. Kotick, Dennis Durkin and Spencer Neumann, 2:21-cv-6240 (C.D. Cal., filed Aug. 3, 2021)

When news broke about the enforcement action, the company's stocks plummeted more than 6%.

On July 27, CEO Bobby Kotick ensured employees in an email that Activision Blizzard was taking action to ensure a safe, inclusive and diverse workplace, and that "there is no place anywhere at our Company for discrimination, harassment or unequal treatment of any kind."

Activision Blizzard Inc. is represented in the securities action by Wilmer Cutler Pickering Hale and Dorr LLP.