Activision Under Investigation For Fraud Following Bungie Split

Zac Cameron,

January 13, 2019 2:34 AM

The company is now being scrutinized after a series of high-profile announcements cause share prices to fall.

Activision, one of the largest gaming publishers out there, is now reportedly under investigation for possible securities fraud and other unlawful business practices, according to MarketWatch. The investigation is to be led by securities litigation firm, Pomerantz LLP with Robert S. Willoughby acting as the point of contact for the firm for investors and shareholders who may have an interest in participating in a potential class action lawsuit.

The recent news regarding Bungie's partnership with Activision has some shareholders concerned

The investigation comes at a difficult time for Activision, capping off a rough six-month period that saw the stock prices decline following several key issues. The issues compound the problems that followed after Destiny 2’s poor commercial performance, which was followed by the below expectation of Call of Duty: Black Ops 4, and contentious announcement involving Overwatch characters apparent sexuality, and the recent announcement that Bungie would be leaving their partnership with Activision and taking the Destiny IP with them.

The biggest hit came with the announcement that Bungie was leaving their partnership ahead of the original 10-year plan, with news that the developer would be retaining their IP rights over Destiny meaning that Activision would no longer have any financial benefit from their partnership. This is also not the first time Activision has come under investigation, with a 2007 Securities and Exchange Commission launched investigation into their stock-option grading practices, and a recent investigation by the US Federal Trade Commission into the usage of loot boxes in games such as Call of Duty. It remains to be seen what will come from this investigation, however Activision shareholders can’t be pleased with the recent turn of events.



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