Microsoft Activision Blizzard has agreed to settle a high-profile class action lawsuit initiated by shareholders for $250 million. The case has become increasingly muddled in recent years, reaching a point where it threatened to renew an investigation into misconduct allegations that shadowed Activision Blizzard before its sale to Microsoft.
The case was brought in 2022 by Swedish pension fund Sjunde AP-Fonden (AP7), which argued that Activision Blizzard acted too quickly to sell itself and deprived shareholders of the chance to secure a higher price than Microsoft's $95-per-share offer. The plaintiffs accused former CEO Bobby Kotick of rushing the sale to protect his position as the company faced increased scrutiny over alleged workplace misconduct. The case eventually became notable for challenging the Blockbuster merger and drawing attention to Activision Blizzard's workplace conduct controversies.
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Microsoft's new settlement will add 30 cents per share to eligible Activision Blizzard investors.
After four years of legal drama, the dispute now appears to be over, according to a preliminary settlement notice filed in Delaware's Court of Chancery and made public in late May 2026. Under the proposal, Microsoft will pay $250 million, and neither side will admit any wrongdoing, as is typical of such deals. The settlement amount will translate to about 30 cents per share for former shareholders. Anyone who owned the developer-publisher's stock between Microsoft's announcement of the Activision Blizzard acquisition in January 2022 and the deal's completion in October 2023 will be eligible to receive a settlement payment if the presiding judge approves the deal in its current form.
In an early 2026 court filing, Microsoft said it had entered into the stipulation to avoid the burden, cost, and inconvenience of further litigation, which is all language that is standard for this type of settlement. The company also denied claims that Activision engaged in systemic or widespread workplace abuse, or that its board, including Kotick, acted improperly in addressing such issues. That denial echoes arguments Kotick and his legal team have made in the years since AP7 first filed suit. In early 2026, Kotick also counter-sued AP7 for “abuse of process”, deepening the legal ordeal. All those disputes are now expected to be resolved soon.
In July 2021, the state of California launched a workplace-discrimination lawsuit against Activision Blizzard. AP7 linked part of its lawsuit to allegations outlined in a California Department of Civil Rights complaint. In the proposed settlement, however, the pension fund acknowledges that its earlier claims were based on allegations that were later described in court-approved language as never proven by a court or independent investigation. The California case was finalized in December 2023, with Activision Blizzard settling for $54 million without admitting any wrongdoing.
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Microsoft initially announced its Activision Blizzard acquisition as a $68.7 billion deal, making it the largest acquisition not only in gaming, but also in the broader technology sector. After Activision Blizzard officially joined Microsoft in October 2023, the company characterized the transaction as a total purchase price of $75.4 billion. Based on that larger accounting figure, the $250 million contract represents a 0.33% increase in the overall cost of the contract.
