H3cz and Scump sue Activision Blizzard over anti-competitive conduct and unlawful monopoly

Several Call of Duty team owners and players have filed a lawsuit against Activision Blizzard seeking damages to the tune of $680 million. The lawsuit alleges Activision Blizzard violated antitrust laws and caused substantial damage to the plaintiffs. 

The lawsuit mentions that Activision Blizzard has an unlawful 100% monopoly over Call of Duty Leagues and tournaments. The demand for a jury trial in the District Court of California was filed on February 15, 2024 with the US District Court of California Western Division as first reported by Maia Spoto for Bloomberglaw.

In an email to Gamesbeat, an Activision Blizzard representative terms the allegations ‘meritless’. 

The Plaintiffs allege that Activision Blizzard wielded its unlawful monopoly to enrich itself at “the expense of the professional Call of Duty players and teams that were now under Activision’s thumb”. The lawsuit alleges the following:

(i) Pay Activision a $27.5 million “entry fee” for the privilege of being one of the  12  teams  allowed  to  participate  in  the  Activision  CoD  League;

(ii)  Give  Activision  an unconditional 50% share of the revenue the team generated from ticket sales, sponsorships, and other revenue streams;

(iii) Cede to Activision the exclusive right to contract with the most lucrative professional Call of Duty sponsors, such as energy drink companies (e.g., Monster Beverage and Mountain Dew) and military-related companies (e.g., USAA Insurance);

(iv) Cede to Activision the exclusive right to contract with broadcasters (e.g., cable television and streaming networks); 

(v) Refrain from participating in or supporting any professional Call of Duty leagues or tournaments other than the Activision CoD League;

(vi) Prohibit the team’s players from participating in or supporting any professional Call of Duty leagues or tournaments other than the Activision CoD League; 

(vii) Prohibit the team’s players from engaging in any commercialized Call of Duty game play (e.g., streaming informal “friendlies” on YouTube or Twitch) outside the Activision CoD League.The 

The lawsuit alleges that Activision Blizzard coerced teams and bought out the competition (MLG) to create a monopoly. This alleged monopoly has transformed the CoD esports scene from a competitive landscape to a monopoly. 

The lawsuit also mentioned that Hector “H3CZ” Rodriguez, who is also one of the plaintiffs, was coerced by the CoD developer to partner with billionaire investors that satisfied Activision’s preferences. The terms of these partnerships created highly unfavorable financial constraints for H3cz’s team.

H3CZ applied as a sole owner for the OpTic brand and the application faced rejection from Activision Blizzard.

The absence of 100Thieves, one of the most popular org names in Call of Duty esports for years was a disappointment for many long-time fans of the game.

The lawsuit plaintiffs include a team owner as well as a former pro player.

Late last year, Activision Blizzard lifted an unofficial stream ban on Scump, allowing him to stream CDL matches.

There are further allegations against Activision Blizzard of acquiring Major League Gaming in 2016 without the approval of the US Federal Trade Commission.

Activision Blizzard has not yet released a public statement at the time of writing but they have sent a response to Gamesbeat calling these allegations meritless. 

Activision Blizzard announced big changes coming to Overwatch League esports last year. With teams given the option to take an $8 million buyout or remain in the League, Overwatch esports will see significant changes this year.

Stay tuned to esports.gg for the latest esports news and updates.