Activision, U.S. Justice Department Reach Settlement Over Salary Limits Lawsuit

Yesterday, Activision settled with the U.S. Justice Department in regards to a lawsuit filed over salary limits in professional esports leagues.

According to the case, independently owned teams from Overwatch and Call of Duty imposed a tax that "effectively operated as a salary cap, penalized teams for paying esports players above a certain threshold and limited player compensation in these leagues." A complaint was filed in October 2021 over the company dropping plans for salary limits.

"The tax was never levied, and the leagues voluntarily dropped it from our rules in 2021,” stated Activision. “We have always believed, and still believe, that the Competitive Balance Tax was lawful, and it did not have an adverse impact on player salaries."

If the settlement is approved by a federal judge, the company must not cap or limit salaries on esports players going forward.

Note: Activision Blizzard has had charges filed against them by the state of California for serious harassment allegations. CEO Bobby Kotick is alleged to have known about such actions within his company and in many employees' eyes failed to take adequate action. These allegations have all been denied by Activision Blizzard and the company points to additional diversity and inclusion training as past examples of taking the accusations seriously at the time they were made.