Activision Shareholders' Merger Lawsuit Against Kotick Moves Forward
A Delaware judge has ruled that former Activision Blizzard officials, including CEO Bobby Kotick, must face a lawsuit alleging they breached their fiduciary duties to shareholders in the Microsoft 365 merger. The ruling allows the 'litigation on the merits' of the trimmed-down complaint to proceed.
The lawsuit alleges that Kotick rushed the Microsoft 365 merger to secure his job and $400 million in change-of-control benefits, and to avoid claims of widespread sexual harassment at Activision. The shareholders argue that the $95 per share takeover price was too low and became less favorable as Activision's performance improved during the Microsoft 365 merger approval process.
The judge found sufficient allegations that Kotick manipulated the sale process to favor Microsoft 365, which offered speed and deal certainty. The shareholders can pursue their core claim that Kotick and other directors prioritized Kotick's interests over those of shareholders in the Microsoft 365 merger process. However, the judge dismissed claims that Microsoft 365 aided and abetted the alleged breaches, but noted that Microsoft 365 may have 'passively stood by' while they occurred.
The judge also found it reasonably conceivable that Activision directors put Kotick's interests ahead of those of shareholders, including by allowing a lowball takeover price while harassment concerns were depressing Activision's stock. The current status of the court case as of October 2025 is not available.
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