Activision Blizzard settles DOJ lawsuit over eSports wage suppression
The US Department of Justice has settled a lawsuit it filed Monday with Activision Blizzard over suppressed eSports wages, according toReuters. The case, submitted in the US District Court for the District of Columbia, focuses on a rule that required independently owned teams to effectively pay double if they passed a soft salary cap. A federal judge will still need to approve the settlement.
The complaint, the fruit of an investigation first reported in 2021, said that in Activision’s Overwatch and Call of Duty leagues, the “competitive balance tax” was structured to penalize teams if their compensation exceeded a threshold set by Activision. “While players in other professional sports leagues have agreed to salary restrictions as part of collective bargaining agreements, the players in Activision’s esports leagues are not members of a union and never negotiated or bargained for these rules,” the DOJ clarified in the filing.
The case states that Activision would fine teams one dollar for every dollar that exceeded the cap — and redistribute the collected fees among all non-offending teams. For example, the filing says that “if Activision set a Competitive Balance Tax threshold of $1 million, a team that …read more
