Microsoft has agreed to settle a high-profile class action lawsuit brought by Activision Blizzard shareholders for $250 million. The case had become increasingly muddled in recent years, reaching a point where it threatened to re-examine allegations of misconduct that had shadowed Activision Blizzard before its sale to Microsoft.
The suit was brought in 2022 by the Swedish pension fund Sjunde AP-Fonden (AP7), which argued that Activision Blizzard acted too quickly in selling itself and deprived shareholders of a chance to secure a higher price than Microsoft's bid of $95 per share. The plaintiffs accused former CEO Bobby Kotick of rushing the sale in an effort to protect his own position as the company faced increasing scrutiny over alleged workplace misconduct. The case eventually became notable both for challenging the blockbuster merger and for bringing Activision Blizzard's workplace behavior discussions back into focus.
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Microsoft's new settlement would add 30 cents per share to qualified 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 would pay $250 million, and neither party would admit any wrongdoing, as is typical of such agreements. The settlement sum would 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 would be eligible to receive the settlement payout if the presiding judge approves the settlement in its current form.
In an early filing from 2026, Microsoft said it had entered into the plea to avoid the burden, expense and distraction of further litigation, which is language that is standard for this type of settlement. The company also denied allegations that Activision had engaged in systemic or widespread workplace misconduct, or that its board, including Kotick, acted improperly in addressing such matters. This denial echoes arguments Kotick and his legal team have made in the years since AP7 first began its litigation. In early 2026, Kotick even sued AP7 for “abuse of process,” further muddling the legal process. All these disputes are now expected to be resolved shortly.
In July 2021, the state of California filed a workplace discrimination lawsuit against Activision Blizzard. AP7 originally linked part of its lawsuit to allegations outlined in the California Civil Rights Department's complaint. In the proposed settlement, however, the pension fund acknowledges that its earlier claims were based in part on allegations that were later described in court-approved language as never having been substantiated by a court or an independent investigation. The California case was settled in December 2023, with Activision Blizzard settling for $54 million without admitting any wrongdoing.
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Microsoft originally 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 the larger accounting figure, the $250 million settlement represents a 0.33% increase in the total cost of the deal.
