Investors in Activision Blizzard Inc., a renowned video game maker, are expected to challenge a US appeals court to re-establish their allegations that the company artificially bolstered its stock price by camouflaging state and federal sexual harassment investigations. The motion is set to be heard on Thursday. The ramifications of the court’s decision might have far-reaching implications for what information businesses are mandated to disclose when a government launches a critical inquiry.
The accusation leveled by investors suggests that public statements by Activision, recently acquired by Microsoft Corp., deeming ongoing investigations as merely “routine” were plainly unfounded. This fraudulent portrayal, investors claim, propped up stock values, concealing the actual gravity of the situation.
In response, Activision contests the allegations, seeking to uphold the dismissal of the proposed class action by the lower court. According to a July submitted brief, the company asserts its stance with the US Court of Appeals.
The revival of this #MeToo stock drop lawsuit, if granted, would be a landmark action, not just for Activision Blizzard Inc., but for similarly placed corporations across the globe.
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