Gaming giant Activision Blizzard has once again found itself in legal trouble, this time over allegations of cutting salaries of cyber athletes. The US Department of Justice has sued the company, accusing it of violating antitrust laws in its cybersports business.
Violation of Antitrust Laws in Cybersports Business
According to the lawsuit, Activision Blizzard implemented a “competitive balance tax” for the Overwatch and Call of Duty leagues, which fined teams if they paid their cyber athletes above a certain threshold set by the company. The Justice Department believes that this tax led to an artificial restriction of competition, resulting in undervalued salaries for cyber players.
Activision Blizzard’s Defense
An Activision Blizzard spokesperson defended the company’s position, stating that the competitive balance tax was aimed at promoting fair pay and privileges for cyber athletes. The tax was allegedly designed to create promising career opportunities for players and ensure competitive products.
The spokesperson maintained that the tax did not negatively impact player salaries and was never levied. Furthermore, the leagues voluntarily removed the tax from their rules in 2021.
Prohibition of Rules Restricting Cyber Athletes’ Fees
Even before the lawsuit went to court, the Justice Department’s antitrust division issued an order prohibiting Activision from enacting rules that restrict cyber athletes’ fees.
