Last Updated: April 04, 2023, 03:23 IST
The Justice Department stated the lawsuit is an element of a broader focus of the Antitrust Division on anticompetitive labor market abuses. (Image: Activision Blizzard Twitter)
The Federal Trade Commission moved to dam Microsoft’s $69 billion bid to purchase “Call of Duty” maker Activision Blizzard in December
The US Justice Department has filed a civil antitrust lawsuit against Activision Blizzard, Inc. (Activision), alleging anti-competitive conduct by one of the world’s largest video game developers and publishers.
“Video games and esports are among the most popular and fastest growing forms of entertainment in the world today, and professional esports players—like all workers—deserve the benefits of competition for their services. Activision’s conduct prevented that from happening,” said Assistant Attorney General Jonathan Kanter of the Justice Department’s Antitrust Division. “Today’s lawsuit makes clear that the Antitrust Division remains committed to protecting workers across all types of industries from anticompetitive conduct.”
The Federal Trade Commission, which works with the Justice Department to enforce antitrust law, moved to block Microsoft’s $69 billion bid to buy “Call of Duty” maker Activision Blizzard in December.
The complaint, filed today in the U.S. District Court for the District of Columbia, alleges that in two esports leagues owned by Activision, Activision and the independently-owned teams in each league implemented a so-called Competitive Balance Tax. As alleged in the complaint, the Tax was structured to penalize teams in the Overwatch and Call of Duty Leagues, respectively, if a team’s player compensation exceeded a threshold set by Activision.
At the same time, the Antitrust Division filed a proposed consent decree to address its competition concerns.
“If approved by the Court, the proposed consent decree would prohibit Activision from imposing any rule that would, directly or indirectly, limit player compensation in any of Activision’s professional esports leagues, or that would tax, fine, or otherwise penalize any team for exceeding a certain amount of compensation for its players,” the Justice Department stated.
The proposed consent decree with Activision would additionally require Activision to certify that it has ended all Competitive Balance Taxes in its skilled esports leagues, to implement revised antitrust compliance and whistleblower safety insurance policies, and to supply discover and a proof of the ultimate judgment to groups and gamers in its skilled esports leagues.
The Justice Department stated the lawsuit is an element of a broader focus of the Antitrust Division on anticompetitive labor market abuses.
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