ATVI - Activision sued by Justice Department over esports antitrust issues

2023-04-03 14:19:47 ET

• The U.S. Justice Department sued Activision Blizzard ( NASDAQ: ATVI ) related to esports antitrust issues with its "Overwatch" and "Call of Duty" games. Activision ticked down 0.6%.
• The lawsuit revolves around alleged illegal salary cap for  teams in the videogame leagues, according to the lawsuit filed on Monday.
• "For years, Activision and the independently owned teams in each league agreed to impose a “Competitive Balance Tax," the DOJ said in in its lawsuit. "The Tax, which effectively operated as a salary cap, penalized teams for paying esports players above a certain threshold and limited player compensation in these leagues. This conduct had the purpose and effect of limiting competition between the teams in each league for esports players and suppressed esports players’ wages."
• The lawsuit comes after the Federal Trade Commission sued to block Microsoft ( NASDAQ: MSFT )'s $69 billion acquisition of Activision ( ATVI ) in December.
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