Call of Duty publisher Activision Blizzard is under investigation for fraud following claims brought forth by company investors, law firm The Pomerantz Firm announced Monday.
The investigation concerns whether Activision and certain of its officers and directors engaged in securities fraud or other unlawful business practices. This comes in the wake of Activision’s recent separation from “Destiny” developer Bungie.
“On January 11, 2019, the Company disclosed that it would be separating from its design and development partner Bungie, Inc. and that Bungie will assume full publishing rights and responsibilities for the “Destiny” franchise,” reads a statement from The Pomerantz Firm, the law firm currently investigating Activision. “Bungie had developed the ‘Destiny’ franchise with Activision as publisher. In the first five days of the ‘Destiny’ franchise’s release, it sold $325M at retail. Following this announcement, Activision’s stock price fell sharply during intraday trading on January 11, 2019.”
Bungie announced it would be severing ties with the publishing behemoth in a post last Thursday, selling the rights of the game back to the developer.
“We have enjoyed a successful eight-year run and would like to thank Activision for their partnership on Destiny,” Bungie wrote in a post on its site Thursday. “Looking ahead, we’re excited to announce plans for Activision to transfer publishing rights for Destiny to Bungie. With our remarkable Destiny community, we are ready to publish on our own, while Activision will increase their focus on owned IP projects.
“The planned transition process is already underway in its early stages, with Bungie and Activision both committed to making sure the handoff is as seamless as possible.”
In a filing with the SEC last week, Activision wrote that as a result of the deal the company “does not expect to recognize material revenue, operating income or operating loss from the Destiny franchise in 2019.”
Activision Blizzard also experienced an executive shuffle at the start of January that saw the departure of two executives and the company naming new heads for Activision, Blizzard, and King.