A class action lawsuit filed by Activision Blizzard against the US publishing giant has been dismissed.
The case alleged the Call of Duty firm had misled shareholders by not disclosing reports of harassment and misconduct at the company. This was publicly revealed in the investigations by the Equal Employment Opportunity Commission (EEOC) and California’s Department of Fair Employment and Housing (DFEH).
As reported by Bloomberg Law, Judge Percy Anderson of the US District Court of the Central District of California dismissed the case, saying that the investors' allegations were "fraud-by-hindsight", meaning that Activision Blizzard would not have been able to predict a bad outcome aka the public revelation of misconduct tanking the company's share price.
“Plaintiffs contend that the media’s reaction to news of the regulatory investigations and Defendants’ statement in response to the DFEH Action 'belies any notion' that the regulatory investigations were ordinary or routine. But such allegations constitute 'fraud-by-hindsight' and absent particularized, temporal facts, are insufficient to support a claim of securities fraud,” Anderson wrote.