Activision Blizzard shares drop after reports allege sexual misconduct

Activision Blizzard CEO Bobby Kotick speaks at CNBC Evolve on November 19 in Los Angeles.

Jesse Grant | CNBC

Activision Blizzard shares fell more than 6% Tuesday after a report from The Wall Street Journal claimed CEO Bobby Kotick was aware of allegations of sexual misconduct at the video game company.

According to the report, Kotick failed to report the allegations to the board of directors on numerous occasions, including the alleged rape, the newspaper reported.

An Activision spokesperson told CNBC in a statement that the WSJ report was an “inaccurate” and “misleading view” of the company’s CEO.

“We are disappointed by the Wall Street Journal’s report, which presents an inaccurate and misleading view of Activision Blizzard and our CEO,” an Activision Blizzard spokesperson said. Action has been taken on cases of sexual misconduct brought to his attention.

In a video message sent to employees on Tuesday, Kotick addressed the report and said anyone who doubts his “conviction of being the most welcoming and inclusive workplace doesn’t really appreciate how important this is to me,” according to a text sent to the company’s website.

The news comes as the video game company faces a series of investigations into its workplace practices, including how it handled allegations of sexual misconduct and discrimination.

In July, the California Department of Employment and Housing filed a lawsuit claiming the company has a “brotherly boy culture” and is a “breeding ground for harassment and discrimination against women.”

Blizzard President J. Allen Brack left the company shortly after the news broke. The lawsuit said he had known since 2019 that employees were leaving due to sexual harassment at the company.

As of Monday’s close, Kotick owned 4,094 shares of Activision worth $285 million, according to FactSet. The magazine previously reported that his compensation package in 2020 was worth more than $154 million.

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