Activision slams ‘meritless’ pending $680M CDL monopoly lawsuit

Call of Duty League team owners and members filed a federal lawsuit against Activision Blizzard seeking over $680 million in damages. The lawsuit alleges the publisher has an unlawful monopoly over professional leagues and tournaments for the triple-A FPS franchise.

In an email to GamesBeat, an Activision spokesperson claimed the allegations in the lawsuit were “meritless.”

CDL Teams v. Activision Blizzard allegations

In 2019, Activision Blizzard closed the Call of Duty esports circuit to form the Call of Duty League. The plaintiffs argued that this shift in structure unfairly prohibited them from earning compensation from entities other than Activision Blizzard. The publisher allegedly leveraged its trademark and ownership of Call of Duty to control both the professional and amateur esports markets for the title.

According to the lawsuit, Activision Blizzard charged 12 teams $27.5 million each to compete in the CDL. Teams were also required to give Activision Blizzard 50% of revenue from ticket sales, sponsorships and other sources. Moreover, teams were unable to sell sponsorships in lucrative verticals like energy drinks or military-related companies. Signed teams and players were also allegedly restricted from competing in or supporting external tournaments. Perhaps the most restrictive of all, players were allegedly unable to commercialize their Call of Duty gameplay outside of the league.

The lawsuit also details allegations from a number of high profile community members including OpTic Gaming’s CEO and cofounder Hector “H3CZ” Rodriguez and its star Seth “Scump” Abner. OpTic Gaming was established in 2006 as a Call of Duty esports team. The organization built its legacy and audience off of their success in the title, though the team diversified into other games.

As first reported by Bloomberg Law, Rodriguez says he was forced into a “financially devastating” partnership to continue competing. In 2017, Rodriguez sold an alleged 92.5% stake in OpTic Gaming’s parent company to Texas Rangers co-owners Neil Leibman and Ray Davis. Then in 2019, Immortals Gaming Club bought the parent company for about $100 million. Rodriguez reacquired the OpTic brand in 2020. Finally, OpTic merged with Envy gaming in 2021.

Activision’s response

Activision Blizzard denied the allegations in the lawsuit shortly after initial reports. The publisher countered these allegations with their own. The statement suggests the lawsuit was filed after the plaintiffs demanded millions of dollars to avoid litigation.

Microsoft completed its $69 billion acquisition of Activision Blizzard in October 2023. Shortly before this, Activision Blizzard spun down its other blockbuster esports experiment: the Overwatch League. Now, third-party tournament organizer ESL Faceit Group operates the title’s esports.

In April 2023, Activision Blizzard settled with the U.S. Department of Justice over what it called “salary caps” for professional players in both the Overwatch and Call of Duty leagues.

The company’s full statement about the pending lawsuit is below:

Mr. Rodriguez (aka OpTic H3CZ) and Mr. Abner (aka Scump) demanded that Activision pay them tens of millions of dollars to avoid this meritless litigation, and when their demands were not met, they filed. We will strongly defend against these claims, which have no basis in fact or in law. We are disappointed that these members of the esports community would bring this suit which is disruptive to team owners, players, fans, and partners who have invested so much time and energy into the Call of Duty League’s success.