Activision Blizzard Facing Class Action Suit From Investors Over Activision-Bungie Split

activision blizzard logo 2015The ongoing drama surrounding the premature split between publishing giant Activision Blizzard and Destiny 2 developer Bungie continues as Activision faces yet another lawsuit over the recent split. Rosen Law announced last week that they were filing a class action suit against Activision in behalf of investors looking to recover damages from the early termination of Activision and Bungie’s partnership.

“According to the lawsuit, defendants throughout the Class Period made false and/or misleading statements and/or failed to disclose that: (1) the termination of Activision Blizzard and Bungie Inc.’s partnership, giving Bungie full publishing rights and responsibilities for the Destiny franchise, a series of science fiction-themed video games, was imminent; (2) the termination of the two companies’ relationship would foreseeably have a significant negative impact on Activision Blizzard’s revenues; and (3) as a result, Activision Blizzard’s public statements were materially false and misleading at all relevant times. When the true details entered the market, the lawsuit claims that investors suffered damages.”

According to Wccftech, the Rosen Law class action suit brings the total number of law firms seeking legal action against Activision up to six. Activision is also under investigation by another law firm - Pomerantz LLP, for alleged securities fraud related to the Activision-Bungie split. “The investigation concerns whether Activision and certain of its officers and/or directors have engaged in securities fraud or other unlawful business practices,” says Pomerantz LLP in a press release. Schall Law, Federman & Sherwood, Levi & Korsinsky LLP, and Faruqi & Faruqi LLP have also filed their own suits against Activision-Blizzard.

“On January 11, 2019, the Company disclosed that it would be separating from its design and development partner Bungie, Inc. ("Bungie") and that Bungie will assume full publishing rights and responsibilities for the Destiny franchise. Bungie had developed the Destiny franchise with Activision as publisher. In the first five days of the Destiny franchise's release, it sold $325M at retail. Following this announcement, Activision's stock price fell sharply during intraday trading on January 11, 2019.”

Activision Blizzard’s stock prices fell as much as 20% in November last year and has been struggling ever since. These legal hurdles aren’t helping investor confidence either which doesn’t bode well for the company’s growth.

activision blizzard nasdaq jan 2019